What Would Happen If CEOs Slashed Their Salaries To Zero?

Dan Fastenberg
What would happen if CEO pay were reduced to zero?
What would happen if CEO pay were reduced to zero?

American CEOs now earn as much as 1,795 times more than their employees. Some activists have organized minimum wage workers, protesting the widening gap, noting executive pay has been rising while workers' pay has fallen. But would workers truly be better off if the bosses agreed to reduced their pay to zero?

On Wednesday, the right-leaning Washington D.C.-based research foundation Employment Policies Institute (EPI) released a report that attempts to puncture labor activists' fantasies that redistribution of executive pay would change the average workers' lives. The EPI, which is funded by restaurant, retail and manufacturing trade groups, crunched the data, looking at what would happen if the CEOs of McDonald's, Starbucks and Walmart were to give away their entire pay to the workers. The result?

Workers' pay would increase just how much per hour
Only Starbucks workers would walk away with a full extra cent per hour of work if their CEO (Howard Schultz) agreed to hand over his entire paycheck.