Median CEO Pay Topped $17.1 Million In 2024, While Median Employee Pay Increased Just 1.7%

The typical compensation package for S&P 500 CEOs rose by nearly 10% in 2024, according to an Associated Press CEO compensation survey. 

The median pay package for CEOs rose to $17.1 million in 2024, up 9.7% from the previous year. Meanwhile, median compensation for employees at these companies went up just 1.7% to $85,419.

Additionally, the S&P 500 rose 23% in 2024, and profits for those companies went up 9%. 

"2024 was expected to be a strong year, so the (nearly) 10% increases are commensurate with the timing of the pay decisions," Dan Laddin, a partner at Compensation Advisory Partners, told AP.

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Raises for the average employee were "long overdue," according to Institute for Policy Studies Global Economy Project Director Sarah Anderson. Still, many workers in the U.S. struggle to pay their bills, especially lower earners. 

Top earners in the survey included Axon Enterprises’ AXON Rick Smith, who has a pay package valued at $164.5 million, GE Aerospace's GE Lawrence Culp, Apple's APPL Tim Cook, Carrier Global's CARR David Gitlin, and Netflix's NFLX Ted Sarandos. 

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The bulk of the pay packages for these top earners consisted of stock or options awards, the survey found. The median stock award went up by 15% in 2024, while base salaries only grew by 4%.

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"For CEOs, target long-term incentives consistently increase more each year than salaries or bonuses," Melissa Burek, a partner with Compensation Advisory Partners, told the AP. "Given the significant role that long-term incentives play in executive pay, this trend makes sense."

Morningstar Sustainalytic Senior Director of Stewardship Jackie Cook also told the AP that there are benefits to tying CEO pay to performance, but noted that increased use of share-based pay has led to a "phenomenal rise" in CEO compensation "tracking recent years' market performance," which has "widened the pay gap within workplaces."

At half the companies included in the survey, it would take the average worker 192 years to make what their CEOs make in one year, according to the AP. This pay ratio tends to be highest in industries where wages are low, like fast food or hospitality.

"With CEO pay continuing to climb, we still have an enormous problem with excessive pay gaps," Anderson told the AP. "These huge disparities are not only unfair to lower-level workers who are making significant contributions to company value – they also undercut enterprise effectiveness by lowering employee morale and boosting turnover rates."

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