Although the ratio of Walmart's Chief Executive Officer to worker pay is high, there is an even greater gap between the retirement package of CEO Mike Duke and the average value of the pension of a non-executive Walmart worker.
Of course within Walmart culture and linguistic political correctness there are no workers, just associates, but for the purpose of this opinion article I will be Walmartian incorrect and use the term "worker." Duke's retirement package is more than $113 million which is almost 6,200 times higher than the average $18,303 that is in the 401(k) accounts of non-executive Walmart workers.
Detailed data on the same ratio for a number of different US companies can be found here. This ratio was the highest among the ten companies studied. Walmart took issue with the description of Duke's compensation as a pension plan instead terming it technically a deferred compensation plan.
The site also gives data on ratio of CEO salaries to management salaries and non-management workers as well. According to the study by the group called NerdWallet, Mike Duke's last year compensation of $20.7 million was 836 times that of the median Walmart worker's salary. Another study by PayScale put the ratio even higher at 1,034. Walmart complains that figures in the PayScale study are inflated. A spokesperson for Walmart said that the pay was the result of the competitive marketplace. The spokesperson said: “We are the world’s largest retailer, and this [the CEO job] is a pretty tough job. We want to make sure the right person is in that job. We have a responsibility to our shareholders to have the right people in the job.”
But even in the competitive marketplace for CEO's Walmart pays poorly.
General Electric CEO Jeffrey Immell earns more than twice what Mike Duke does but this is 638 times that of the average non-executive employee, reflecting no doubt the fact that average worker pay at Walmart is much lower as are the balances in workers 401(k) accounts. In September the largest 401(k) provider Fidelity Investments reports that the average balance in 401(k) accounts is $84,000 more than four times that of the average Walmart worker account.
The lowest CEO salary to average worker ratio among the companies surveyed is that of Google CEO Larry Page whose compensation of $7,628, 624 is just 135 times that of the average non-executive worker. Page does fairly well even though his nominal salary is just one dollar per year! How does Google manage to attract talent like that in the competitive market place at that price? Even with his non-salary earnings he gets only about a third of what MIke Duke gets and Mike Duke himself is not that well paid relative to many other CEOs. Money isn't everything but then 7 plus million dollars is not peanuts either.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com