Pay at the Top: Executive Pay Cut Down to Size

by Mike Hunter

Arizona is ranked 25th in the nation for highest executive pay, according to U.S. Department of  Labor statistics, reported in May of 2011. That means we are middle of the road. The average pay for an Arizona chief executive is $172,279. That is $82.82 per hour. Delaware is first among the states in executive pay at $218,900 and $105.24 per hour while Montana is at the bottom at $104,800 average annual pay and $50.39 per hour.

While these are averages, the real newsmaker is the top pay among the chief executives.  These ranges in Arizona can be between $80 million and just under $800,000. Some are salaries alone and others combine pay, stock options and benefits to round out the newsworthy numbers.  In Arizona, Richard Adkerson, president and chief executive officer of Freeport-McMoRan Copper & Gold, Inc. sits at the top with a nearly $82-million package in 2011 — an all-time record pay day in Arizona. Options and stock awards can mean big money for these tycoons of industry; for Adkerson, options and stock awards represented the majority of his 2011 remuneration, at nearly $69 million. Benefits account for only 2 percent of their overall pay, so it appears that getting a piece of the company is where these top executives are really making out.

Top pay figures make attention-grabbing headlines as the gap between executive pay and employees’ pay is larger than ever before.  According to a study done by the AFL-CIO, which looked at average pay of CEOs of the S&P 500 companies in 2010, these CEOs get an average of 380 times the amount of an average worker’s income. Such a gap is often shrugged off by major corporations citing performance and a company’s profitability with such a leader at the helm.  Although average CEO compensation in Arizona declined in 2011 to $1.33 million from $1.54 million in 2010 for the first time after three consecutive years of increase, the union federation AFL-CIO cites studies to back its contention that all employees create value and that compensation packages for CEOs that are more in line with employee pay improves morale and product quality and lessens employee turnover.

Average Pay in Certain Occupations*

Occupation Arizona U.S.
CEO $172,270 $176,550
Lawyer $124,220 $130,490
Computer Systems Analyst $74,740 $82,320
Registered Nurse $72,340 $69,110
Interior Designer $53,410 $52,810
Social Worker $52,480 $54,220
Firefighter $44,010 $47,720
Average Worker $43,670 $45,230
Elementary School Teacher $42,500 $55,270
Construction Laborer $30,430 $34,170
Food-Service $21,990 $21,430

Top 5 Pay by Occupation in Arizona

Rank Occupation Annual Pay
1 ObGyn $225,370
2 Internist, General $192,550
3 Dentist $183,330
4 CEO $172,270
5 Family Physician $171,090

Top 5 CEO Pay by State

Delaware $105.24 $218,900
Connecticut $101.19 $210,480
California $96.65 $201,030
North Carolina $95.52 $198,690
Oregon $95.11 $197,840

U.S. Bureau of Labor Statistics, May 2011 Occupational Employment and Wage Estimates

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