Pay Ratio Trends
Year-over-year CEO pay and median worker compensation across industries.
Portfolio-Wide Trends by Year
| Fiscal Year | Median Pay Ratio | Avg Pay Ratio | Median CEO Pay | Companies |
|---|---|---|---|---|
| FY2021 | 73:1 | 92:1 | $5.4M | 75 |
| FY2022 | 61:1 | 72:1 | $4.4M | 105 |
| FY2023 | 151:1 | 219:1 | $7.1M | 1,837 |
Highest Ratio Industries
Lowest Ratio Industries
Understanding CEO Pay Ratio Trends
The SEC has required public companies to disclose CEO pay ratios since the 2017 proxy season (for fiscal year 2017). Since then, researchers and investors have used this data to benchmark executive compensation practices across industries.
What Drives High Pay Ratios?
Industries with high median pay ratios — often retail, food service, and entertainment — typically have large workforces of part-time, hourly, or internationally-based employees who earn significantly less than knowledge-worker peers. This depresses median employee pay, widening the ratio even when CEO pay is moderate.
Stock Awards and CEO Pay Volatility
CEO total compensation is heavily influenced by stock award grants, which can swing dramatically year-to-year based on vesting schedules and board compensation committee decisions. A CEO may see their reported total compensation spike when large equity grants vest, even if cash pay remains stable.
FAQ: Pay Ratio Trends
Are CEO pay ratios getting better or worse?
The trend is mixed. While some sectors have seen ratio improvements following tight labor markets and minimum wage increases, CEO equity compensation has continued to grow significantly, especially in technology and healthcare sectors. The data above shows year-over-year changes in our dataset.
Which industries typically have the lowest pay ratios?
Industries with highly-skilled, specialized workforces — such as legal services, financial advisory, and some professional services sectors — tend to have lower median pay ratios because their workforce earns more on average, reducing the gap relative to CEO pay.