LONDON • The year has just begun, but by yesterday afternoon the CEOs of Britain's biggest companies would have already earned as much since Jan 1 as the average worker will make in all of 2019.
The FTSE 100 bosses reached this milestone around 1pm London time (9pm Singapore time), after an 11 per cent jump in pay, according to a report by CIPD, an association for human resource professionals, and the High Pay Centre, a research group. The CEOs surpassed female employees' full-year earnings even earlier, by around 8.30am.
Despite government efforts to make executive pay more transparent and rules giving shareholders a voice on compensation, the gap between CEOs and employees remains stubbornly high. The FTSE chiefs now earn 133 times more than workers, up from 47 times in 1998, based on their median pay.
"To raise living standards, we need growth and innovation, but also to ensure that growth is fairly distributed,'' said Mr Luke Hilyard, director of the High Pay Centre.
The disparity in Britain reflects a broader rise in income inequality across much of the developed world. New rules came into force on Jan 1 that will require all publicly listed UK firms with more than 250 employees to disclose their pay ratios starting next year and justify compensation levels for their top bosses.
There has been increasing criticism of soaring compensation. Last year, Mr Jeff Fairburn quit as Persimmon's CEO after a backlash against his £75 million (S$129.5 million) pay and bonus package.
The gulf in the US is even more glaring, with a CEO-to-worker pay ratio of 312:1 in 2017, according to an August report by the Economic Policy Institute. Average CEO compensation, based on the largest 350 companies, was 18 per cent higher than the previous year.