S&P 500 Low-Pay Firms Show Extreme CEO Wage Gap
CEOs at the 100 lowest-paying S&P 500 companies earned 614 times the median worker pay in 2025, according to a new report.
Executive compensation at major US firms with the lowest median employee wages has reached extreme levels, with CEOs earning 614 times what their median worker made in 2025. This disparity is documented in the Executive Excess report by the Institute for Policy Studies, which analyzed the 100 largest S&P 500 companies with the lowest median pay. The average CEO package in this group stood at $17.5 million, while the median worker earned just $36,571, highlighting a widening chasm between top management and the frontline workforce.
The gap has widened significantly over the past six years. Between 2019 and 2025, median worker pay at these firms increased by 20.7%, a rate that trailed the 25.9% rise in inflation. Consequently, workers at these companies experienced a loss in real purchasing power. In contrast, CEO compensation within the same group climbed 41.4% over that period. This divergent trajectory means that while executives saw substantial growth in their earnings, employees struggled to keep pace with rising living costs.
Corporate Buybacks Outpace Wage Growth
These firms also directed significant capital toward shareholder returns rather than workforce investment. In 2025, the 100 low-wage companies spent $108.6 billion on stock buybacks, an increase from $105 billion in 2024. Over the 2019 to 2025 span, total buybacks reached $718 billion. Walmart, one of the largest employers in the group, spent $8.1 billion on buybacks in 2025. The report notes that this amount could have funded a $3,851 bonus for each of its 2.1 million workers, illustrating the scale of capital allocated to share repurchases versus potential employee compensation.
Individual company data reveals extreme outlier cases. At Walmart, CEO Doug McMillon received $29.2 million in compensation in 2025, which is 958 times the median worker pay of $30,520. Other firms with notable disparities include Lumentum Holdings, where the CEO earned 2,884 times the median employee wage. Aptiv, Starbucks, Coca-Cola, and Ross Stores also feature prominently in the list of companies with the widest pay gaps. These figures underscore that the 614x average is driven by companies where executive pay multiples are exceptionally high relative to the lowest-paid staff.
Link to Billionaire Wealth and Policy
The report links the wealth of at least 36 billionaires to these low-wage employers. This includes the eight Walton family members associated with Walmart, Jeff Bezos and Mackenzie Scott of Amazon, and Carvana co-founders Ernie Garcia II and III. The concentration of wealth among executives and major shareholders in firms that rely on low-paid labor raises questions about the distribution of economic gains within the S&P 500.
To address what it terms excessive compensation, the report proposes several policy measures. These include imposing higher taxes on corporations where CEO pay exceeds 50 times the median employee wage, increasing taxes on stock buybacks, and restricting government contracts for firms that conduct buybacks. The Institute for Policy Studies argues that these steps could reduce the incentive for extreme pay disparities and redirect corporate resources toward broader economic stability. The analysis provides a detailed baseline for policymakers considering regulatory responses to executive compensation structures in large US corporations.
