Americans waiting for an app before they boycott unequal pay
Oct 16, 2015, 5:43 AM | Updated: 7:33 am
Americans are angry about the pay gap between average employees and CEOs. However, they probably don't care enough to actually go through the SEC filings to find out which companies have the most unequal pay, KIRO Radio's Dave Ross says. (AP)
(AP)
The Washington Post’s Wonkblog points out that, come 2017, the Securities and Exchange Commission will require most public companies not only to reveal how much their CEO makes — which they already have to do — but how the CEO’s pay compares to the pay of the average employee: a pay gap ratio.
The rule doesn’t limit CEO pay in any way, it just requires the company to calculate and post the pay gap so that it’s easy to compare with other companies.
Wall Street fought hard to kill this idea and it’s easy to see why. Surveys have shown that Americans consider a pay gap of about 7:1 to be fair, but the actual gap is not 7:1. It’s not even 20:1, which is what it was 40 years ago. The average ratio in the U.S. is now 351 to 1. At some companies, it’s believed to be 1,000 to 1.
And there is also research showing that Americans actually care about this; enough so that they might boycott high-inequality companies in favor of low-inequality companies even if it means spending more on the product.
The only question is, do they care enough to go through the SEC filings of every company they do business with to look up the information. My guess is: No, they don’t.
But I’m pretty sure they won’t have to.
Because I predict that come 2017, there will be an app. A pay gap app that allows you to point your phone at any product and see the company’s pay gap displayed as a line of little yacht icons. At which point the market is free to work its magic.
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Tune in to KIRO Newsradio weekdays at 5am for Dave Ross on Seattle's Morning News.
