While most workers received modest 3% pay raises in 2024, CEOs at America’s largest companies saw their paychecks grow much faster. The median S&P 500 CEO earned $16.4 million in 2024, marking a 6% increase from the previous year. This gap between executive and worker pay has reached stunning proportions that even surprise wealthy Americans.
CEO pay soared 6% while workers got modest 3% raises, creating a wealth gap that shocks even millionaires.
The numbers tell a remarkable story about income inequality. Today’s CEOs earn 281 times more than typical workers, compared to just 21 times more in 1965. To put this in perspective, a median worker earning $49,500 would need to work from the year 1740 until today to match what the average CEO made in 2024 alone. Even America’s millionaires find these figures eye-opening.
Several factors drive these massive pay increases. Long-term incentives jumped 27% to $11 million for median CEO compensation. Stock awards climbed to $9.9 million, while option awards reached $3.3 million. Base salaries, though still substantial at $1.3 million, represent the smallest portion of total pay packages. Some executives who receive significant stock compensation may face short-term capital gains taxes on their trading profits if they sell shares quickly after receiving them.
Some industries saw even more dramatic increases. Consumer durables and apparel companies boosted CEO pay by 21.2%, while commercial services raised compensation by 16.9%. Entertainment and recreation sector CEOs averaged over $35.2 million annually. The food and beverage industry bucked the trend with CEO pay decreasing by 4.4% despite widespread increases across other sectors.
The highest-paid executives command truly staggering amounts. QXO Inc.’s Brad Jacobs topped the charts with $189 million in 2024. Veeva Systems’ Peter Gassner earned $172 million, while Axon Enterprise’s Patrick Smith received $164 million. Even well-known names like Starbucks CEO Brian Niccol collected nearly $96 million. Starbucks Workers United continues organizing efforts to improve worker pay while their CEO earns 6,666 times more than the median employee.
This trend shows no signs of slowing. Over 69% of S&P 500 CEOs received pay increases, with those lucky executives seeing median raises of 13.2%. Over five years, CEO compensation has climbed 26% for large companies and 51% for smaller public companies.
The growing salary gap reflects broader economic changes and corporate governance practices. While shareholders and board members justify these packages as necessary to attract top talent, critics argue the disparity undermines social cohesion and economic fairness across American society.
