The wealthiest Canada CEOs have already earned the average worker’s annual salary

The wealthiest Canada CEOs have already earned the average worker’s annual salary

The highest-paid CEOs in Canada have already earned that worker’s entire annual salary in 2023.

Buildings in Toronto, Canada

Skyscrapers in Toronto’s financial district, home to many of the country’s top-paid CEOs. A new report found that the 100 best-paid chief executive officers in Canada now make 243 times what the typical worker earns: $14.3 million versus $58,800.

This fact means yesterday morning on the third day of the new year, the average worker was already beaten.

As per a report published yesterday by the Canadian Centre for Policy Alternatives (CCPA), an Ottawa organization that focuses on economic issues, the top 100 paid CEOs in Canada make 243 times more than what the average worker earns.

“In a time of difficulty for workers facing inflation and at a time when we’ve seen economic growth, it really raises the fundamental question of who benefits from economic growth,” said David Macdonald, senior economist at the CCPA.

David Macdonald is senior economist at the Canadian Centre for Policy Alternatives and the author of the report, which says that those CEOs in Canada in the top tier earn only eight per cent of their income from an actual salary. The rest is based on company profits, revenue and performance.

David Macdonald is senior economist at the Canadian Centre for Policy Alternatives and the author of the report, which says that those CEOs in the top tier earn only eight per cent of their income from an actual salary. The rest is based on company profits, revenue and performance.

“Is it all Canadians, or is it really just the folks at the very top who see these massive pay packages?”

Some say the issue isn’t how much money these executives make, but rather how they earn it. Among the CCPA’s suggestions to close the pay gap is a wealth tax — which would pose issues of its own.

The gap is growing

The top-paid executives in Canada earned roughly an average of $14.3 million in 2021.

Meanwhile, the average private-sector worker made just under $58,800 in 2021.

“The issue isn’t that CEOs get paid more than the average worker. Certainly, they should get paid more than the average worker,” Macdonald said. “The issue here is how rapidly the gap is growing.”

As inflation rates began growing in 2021, some companies said they would increase consumer prices to make up for supply chain challenges and labour shortages.

The CCPA’s report says that those CEOs in the top tier earn only eight per cent of their income from an actual salary.

But even as some companies introduced revisions to their compensation policies for executives, many CEOs were protected from pay declines. The report says that variable compensation is capped on the downside — but not the upside.

“When times are bad, you change the rules in terms of how bonuses are paid,” Macdonald said.

The wealth tax is not a simple solution

The report makes several suggestions to reduce the pay gap. Most notably, it suggests imposing a small wealth tax on the rich.

Donna Hokiro, president of United Steelworkers Local 1944 in Edmonton, said that any potential wealth tax “needs to do what it’s designed to do.”

“If the aim is to take excessive amounts of wealth and put it back into the communities and make it easier for people to not live in poverty, I’m all for it,” she said.

The idea of a potential tax on wealthy individuals isn’t new to Canada — the NDP has called it a top policy priority, saying that the federal revenue could be used to reinvest in health care and housing. Others say it could have unintended consequences.

Top-paid CEOs in Canada

Highest-paid CEOs in Canada

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