CEO Pay Swells in 2025, Deepening Gap with Median Workers

The AP survey of 337 S&P 500 CEOs shows the typical chief executive earned $17.7 million in 2025, a 6 percent rise, while the median employee earned $89,744, a 4.7 percent increase.

Associated Press

Since 2018, firms must disclose CEO-to-median-worker pay ratios; half of the surveyed companies now require a worker 200 years of median earnings to match one CEO year, up from 192 years. Coca-Cola’s CEO earned about 1,739 times the median worker’s $17,947, and TJX’s chief earned roughly 1,774 times its median pay.

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Stock awards now dominate pay, vesting only if share price, market value or operating profit targets are met; one-time awards are used to retain CEOs. Shareholders vote on pay in non-binding “say-on-pay” polls, with an average 90 percent approval.

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• Elon Musk (Tesla): $132.3 billion in stock awards tied to ten-year market-value and product milestones.

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• Shankh Mitra (Welltower): $821.1 million, mostly stock, payable after a decade.

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• Hock Tan (Broadcom): $205.3 million linked to AI-driven revenue growth through 2030.

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• Jane Fraser (Citigroup): $95.8 million, including a $25 million award for a wholesale reorganization.

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Private-sector wages rose 3.4 percent in 2025, raising the median U.S. worker’s earnings to $67,000 and total compensation with benefits to $96,000. Women CEOs’ median pay fell 2.6 percent to $18.1 million; the survey lists male CEOs’ median at $17.7 billion, up 6.4 percent—a likely error.

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Ballot initiatives in San Francisco and Los Angeles seek taxes on firms with large CEO-worker gaps; advocates and some members of Congress call the disparity obscene amid rising costs.

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Companies argue that performance-linked stock awards tie pay to shareholder returns; 90 percent of shareholders support the plans. Compensation adviser Kelly Malafis notes, “Use of AI considerations or metrics in incentive plans has not yet taken hold as a majority practice.”

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Sarah Anderson of the Institute for Policy Studies says, “At a time when working families are struggling with rising costs, it’s obscene to see CEO pay continuing to skyrocket.”

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The male-CEO median compensation figure of $17.7 billion conflicts with typical individual packages, suggesting a typographical error. The survey also does not break down employee benefits beyond the $96,000 aggregate.

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• “At a time when working families are struggling with rising costs, it’s obscene to see CEO pay continuing to skyrocket,” — Sarah Anderson, Director, Global Economy Project, Institute for Policy Studies

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• “Use of AI considerations or metrics in incentive plans has not yet taken hold as a majority practice,” — Kelly Malafis, Founding Partner, Compensation Advisory Partners

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California ballot measures will be decided in upcoming elections, and federal regulators may scrutinize the reliance on stock-based pay. Companies are watching AI-linked incentive designs as a possible future norm.

Associated Press