Detroit Today: What is income inequality doing to all of us?
The report also found that CEO pay dipped in 2022, but that it remains enormous compared with the pay of other workers.
Exorbitant CEO pay has contributed to rising inequality in the United States, according to a new report from the Economic Policy Institute.
CEO pay has skyrocketed more than 1,200% since 1978, compared to a 15.3% increase in a typical worker’s compensation, according to a new report out today from the Economic Policy Institute (EPI).
The report also found that CEO pay dipped in 2022, but that it remains enormous compared with the pay of other workers. As the United Auto Workers union continues its strike against General Motors, Ford and Stellantis, UAW President Shawn Fain has often cited record profits and bonuses for CEOs as a point of contention for workers who have not shared in those gains.
Josh Bivens, chief economist for the EPI, and Luke Schaefer, associate dean for research and policy engagement at the University of Michigan’s School of Public Policy, joined Nick Austin on Detroit Today this morning to discuss how income inequality affects our economy and society as a whole.
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Guests:
Josh Bivens is the chief economist at the Economic Policy Institute (EPI). His areas of research include macroeconomics, inequality, social insurance, public investment, and the economics of globalization. Bivens says the new EPI report shows CEO pay has gone up dramatically over the last several decades compared to worker’s pay.
“I don’t quite know what’s fair,” he told Austin, “I do know this stratospheric CEO pay has not bought us anything in terms of a more efficient or faster growing economy, so I’d love to see it quite reduced in the name of fairness.
Luke Shaefer is associate dean for research and policy engagement at the Gerald R. Ford School of Public Policy at the University of Michigan. Shaefer says while some might argue a certain level of income inequality can promote innovation in some cases, it is easy to see how the level we face today can negatively impact many aspects of our lives.
For example, he says, “as income inequality rises we can see more pressure being put on the housing market, especially in the last decade or two when we’ve had a decline in the building of housing.”
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