The bosses of Britain’s biggest companies will have made more money in 2023 by Thursday afternoon than the average UK worker will earn in the entire year, according to analysis of vast pay gaps amid strike action and the cost of living crisis.
The High Pay Centre, a thinktank that campaigns for fairer pay for workers, said that by 2pm on the third working day of the year, a FTSE 100 chief executive will have been paid more on an hourly basis than a UK worker’s annual salary, based on median average remuneration figures for both groups.
Paul Nowak, the general secretary of the TUC, the unions’ umbrella body, called on the government to intervene to “bring back some fairness on pay” as many lower-paid workers struggle with swingeing real-term cuts to their income.
“Everyone deserves a fair day’s pay for a fair day’s work. But while working people are told not to ask for more, top pay is soaring,” he said. “We need government action to bring back some fairness on pay. Workers should have seats on executive pay committees to bring some common sense to top pay. And ministers must set out plans for fair pay for everyone, starting by agreeing to pay negotiations in the public sector.”
According to analysis by the GMB trade union, it would take a 999 ambulance call handler almost 150 years to match the pay of the average chief executive. “It’s an utter disgrace,” said Gary Smith, the general secretary of the GMB, which represents ambulance workers set to go on strike next week. “NHS workers and others are being forced on to the picket lines just to make ends meet while these fat cats get the cream.”
FTSE 100 chief executives are paid £3.4m on average, which works out at 103 times the £33,000 average salary for full-time UK workers, according to Office for National Statistics figures.
The figures highlight how executive pay has increased dramatically after a dip during the pandemic, while ordinary workers are struggling to secure pay rises anywhere near inflation. Median FTSE 100 CEO pay is up 39% on January 2022, while the median worker’s pay has increased by only 6% over the same period.
This year, FTSE 100 bosses will pass the pay milestone nine hours earlier than they did in 2022. The data suggested that CEOs would have to wait until the fourth working day of 2022 to overtake the median worker’s annual salary, while this year they will accomplish the feat in under three days.
Luke Hildyard, the director of the High Pay Centre, said: “In the worst economic circumstances that most people can remember, it is difficult to believe that a handful of top earners are still raking in such extraordinary amounts of money.
“The UK economy really cannot afford for such a big share of the wealth that is created by all workers to be captured by such a tiny number of people at the top. To address declining living standards for the majority, we need measures to balance the distribution of incomes more evenly.”
The highest-paid FTSE 100 CEO, according to the research, was Sébastien de Montessus, of Endeavour, which operates goldmines in Ivory Coast, Burkina Faso and Senegal. He was paid £16.9m, including an £8m “one-off award” when the firm relocated from Toronto to London.
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The second highest-paid boss was Pascal Soriot, of AstraZeneca, who was paid £13.9m.
Executives below CEO level in the FTSE 100 and the senior bosses of the next 250 largest UK companies would need to work until 11 January for their pay to overtake the annual earnings of the median UK worker.
A lawyer in a magic circle law firm would need to work until 9 January, while a partner in one of the big four accountancy firms would wait until 16 January, and it would be a day later for a top banker at one of the UK’s five biggest listed banks.
Every person in the top 1% of full-time UK earners, making at least £145,000, will have overtaken the annual earnings of the median employee by 23 March.