The leaders of some of the UK’s most prominent companies will have today earned more than the average worker will this year (Thursday, 5 January).
Research by the High Pay Centre shows that at 2pm today FTSE 100 company chief executives will have already earned an average of £33,000 in 2023 – the same as the median salary for a UK worker. The data is based on figures from last year, taken from the Office for National Statistics and the financial reports of publicly listed companies.
The TUC has responded by urging pay committees to restore common sense to remuneration awards.
FTSE 100 chief executives have seen their salaries rise by 39% over the past year, easily offsetting increases in the cost of living. Meanwhile, the average worker has seen their pay rise by 6% over the same period.
Last year, High Pay Day arrived at 9am on 7 January.
“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,” High Pay Centre director Luke Hildyard said.
“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.”
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Sheila Attwood, senior content manager, data and HR insights at Cendex, part of XpertHR, said that employers needed to acknowledge the effect of High Pay Day on employees.
She said: “With the cost-of-living crisis looming and other economic pressures hitting home, it is not surprising that the campaign for fairer pay is gaining momentum – expatiated further by the coverage of High Pay Day. Employers can really help their recruitment and retention efforts by ensuring that employees feel valued in light of data such as this. The simplest way for employers to be certain they are paying staff fairly is to benchmark salaries against competitors, regularly reviewing their offering to check it aligns with the current market.
“What is crucial, too, is transparency. Employers will benefit from being upfront with how pay levels are calculated, clearly communicating to staff how salary bands are devised and how potential earnings are achieved.
“During economically challenging times such as these, employers should consider how else they can support staff, whether that be a one-off payment, a zero-interest loan or an additional salary review.”
Paul Nowak, the general secretary of the TUC, said ministers should intervene to “bring back some fairness on pay” because many lower-paid workers were struggling.
“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.”
Gary Smith, general secretary of the GMB union, said: “A hard-up 999 call handler would have to work for 150 years to earn what a CEO boss trousers in just 12 months. It’s an utter disgrace.”
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