General Discussion
In reply to the discussion: Does anyone else have a problem with this? [View all]Igel
(35,197 posts)More importantly are uncertainties in the #s.
The US CEO "total compensation" includes health insurance, retirement, and stock/stock options. These things tend to be expensed as cash, with retirement credited at termination of contract or a percentage expensed each year of the contract. Stock options are priced at estimated value when they're redeemable, but that's a guess. Given the turnover in American CEOs, a lot of retirement benefits are cashed out each year.
Some things--cashing out the retirement benefits--takes away money this year that could go to worker salaries. But it means next year that's not an expense.
Other things like stock options cost the company no money and don't take money away from employee salaries. That's the largest chunk of the CEO compensation.
Other things are listed as CEO compensation--health insurance, for example--but not for employees. We hear that middle class salaries dropped in the '00s. But middle class compensation increased by a fair amount. Both are true.
This all matters when we're calculating the numbers, if we want to know what the numbers mean and not just take away some sort of impression.