Top UK bosses earning 190 times more than average employee in UK

Chief executives of the UK's top companies are trousering an average wage that is 190 times bigger than the salary an average British employee takes home every year, according to new research

With real wages beginning to be squeezed, as inflation surges above 2% amid sluggish wage growth, the Equality Trust conducted the analysis in order to expose the pay inequality experienced by many workers across Britain.

In fact, Wednesday also saw data showing UK households are at their most pessimistic about financial prospects in more than three years.

FTSE 100 CEOs are compensated on average £5.3m annually, in comparison with the average UK salary of £27,615.

Blue chip CEOs were paid 386 times more than the living wage of £13,662, the survey found.

The research was taken from annual reports in 2015 from all companies in the FTSE 100, finding that 67% of the CEOs monitored were paid more than 100 times the average UK wage.

Martin Sorrell, boss of advertising giant WPP, was by far the highest earner found during the analysis, with a £70.4m compensation which is 5,000 times higher than the minimum wage.

Wage slaves

The government's consultation on corporate pay, which is due to be published soon, has received proposals including forcing firms to reveal the pay gap between their chief executives and average workers, or making sure corporate remuneration committees consult shareholders and workers about executive pay levels.

Bank of England Governor Mark Carney late last year said Britain was in the midst of "the first lost decade since the 1860s", with real wage growth collapsing dramatically over the last 10 years.

While the slump in real wage growths has been largely nullified by low inflation since the financial crisis, 2017 has real wages come under pressure as the Brexit-driven collapse in the pound meets stuttering wage growth.

On Wednesday, a survey from IHS Markit found the sting of rising inflation has led to the worst household financial expectations since November 2013.

Amid a string of shareholder revolts around the size of CEO pay packages, including at BP, Rolls-Royce, Smith & Nephew and Crest Nicholson, the Equality Trust’s executive director Wanda Wyporska commented that she hoped the analysis would shed light on the issue of CEO pay.

"The result is that the UK is one of the most unequal countries in the developed world and there is, rightly, great concern about excessive rewards at the top end of the pay scale compared to the amounts most people take home," Wyporska said.

"Despite the wealth of evidence on the pernicious effects of inequality, and growing unease with pay inequality, there is still a lack of public knowledge and understanding as to just how extreme executive pay is compared to what most people have to live on."