Trickle Up Economics

Sojourners Magazine, Jan 2004 by Berger, Rose Marie, Bolton, Brian

Companies with the highest number of worker layoffs in 2001 had CEOs who received larger pay increases than companies with fewer layoffs, according to a recent report. Boston-based United for a Fair Economy and the Institute for Policy Studies in Washington, D.C., sponsored the study to expose injustices in U.S. executive compensation.

"One of the most important [themes in the report]," says AFL-CIO analyst Brandon Rees, "is that executives are sheltering their retirement plans from the risks that everyone else is expected to shoulder." There are a few companies, such as Cisco Systems, where the CEOs took pay cuts. Here are the numbers.

* 6%: U.S. unemployment rate in November 2002, equaling the highest rate since mid-1994, representing about 8.5 million people.

* 6%: Median CEO pay increase for 365 companies surveyed by Business Week in 2002.

* 44%: Median pay increase of the CEOs of the 50 companies with the largest numbers of layoffs.

* 1,612%: Pay increase for AOL Time Warner CEO G.M. Levin in 2002.

* 100%: Pay decrease for Cisco Systems CEO John Chambers in 2002.

Sources: United for a Fair Economy, Institute for Policy Studies, Los Angeles Times