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According to a survey by the AFL-CIO, more CEOs received increases in compensation than pay cuts last year. This occurred despite increased scrutiny of executive pay and new rules imposed after the government began a bailout of financial companies.
The news is likely to cause some outrage since 2008 also saw the largest drop in employment in almost 30 years. Politically, it will be hard to justify bailing out companies if CEOs are receiving more money than they did when the crisis began.
Last month, news of bonuses at AIG - a company that received funds under the federal government's Troubled Asset Relief Program - set off a firestorm of controversy and congressional consternation. This report seems designed to elicit the same sort of reaction.
That would suit the AFL-CIO just fine. The country's largest labor federation loves to call attention to the excesses of corporate managers.
But questions about the sample size and methodologies could prevent the survey from raising too many eyebrows. The study examined 946 companies from the Russell 3000 index and found that 480 executives' pay went up, while 463 had pay cuts. Neither the size of the study nor the split between raises and cuts is very large.
The survey also looked at compensation that included stock options that had been granted but had not yet vested. According to a Reuters report, many governance experts prefer this method since it attempts to divine what corporate boards really meant to give the CEOs with their compensation package.
It's also a little speculative since the options might never vest, and the eventual value might be far less than the estimate.
No matter the methodology or the form of the compensation, however, paying CEOs millions while laying off millions of workers just doesn't look good.
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