JPMorgan CEO Jamie Dimon says it’s OK that chief executives get paid way more than their average employees — and that cutting down on executive compensation wouldn’t help eliminate income inequality.
That’s according to Bloomberg’s Claire Boston and Hugh Son, who wrote up comments from Dimon at a Detroit event Thursday.
“It is true that income inequality has kind of gotten worse,” Dimon said, according to the report. But “you can take the compensation of every CEO in America and make it zero and it wouldn’t put a dent into it. What really matters is growth.”
In August, the US Securities and Exchange Commission adopted a new rule requiring public companies to disclose how much money CEOs earn in comparison to typical employees.
The idea is to help shareholders make decisions on company performance based on things like employee morale and turnover.
But as Business Insider reported in August, JPMorgan’s CEO-worker pay gap is likely to be one of the most stark of all the major Wall Street firms. The gap is even wider in some other industries.
The new disclosure will include median worker pay, so we don’t yet know what the exact number will be for JPMorgan. But we calculated average employee pay at the bank and a handful of others, and compared it to their CEOs’ compensations.
By that measure, Dimon’s $27.7 million pay package last year was about 221.7 times that of his average employee, who earned about $124,959 for the year.
Dimon officially became a billionaire in June.
As for the middle class, Dimon reportedly said Thursday: “It’s not right to say we’re worse off … If you go back 20 years ago, cars were worse, the air was worse. People didn’t have iPhones.”
We reached out to JPMorgan and will update this story if the firm has any additional comments.
As reported by Business Insider