Editorial: Greedflation

I have reported before on the seemingly ever-expanding wage gap between CEO’s and their workforce.  Now, I do understand that the cost for a captain steering the ship is higher than the cost for a deckhand, but in 2020 the average CEO earned 365 times what their regular employee earned.  That means every single day the CEO made what their median employee earned in an entire year.  But as crazy as that sounds, these wage gaps got much, much worse.  In 2021, it was estimated that the CEO-to-worker compensation ratio was 398.8 in the United States. This indicates that, on average, CEOs received about 398.8 times the annual average salary of a production and/or nonsupervisory worker in the key industry of their firm.  Sounds like we need to start a conversation.

Recently the CEO of Starbucks’ earned 1,579 times more than their median employee, while the CEO at McDonald’s earned 2,251 times more than their average worker.  The pay gap for the CEO of Expedia was 2,897-to-1, and although we shouldn’t be surprised by this, the pay gap at Amazon was 6,474-to-1.  Amazon’s CEO needed to be paid 6,474 times what their average worker made?  Seriously?  

From 1978 – 2021, CEO pay skyrocketed by 1,460%.  For the past 10 years, the average CEO pay climbed by approximately $500,000 each year, while the average worker wages have increased by just $1,303.  That hurts, doesn’t it?  Let’s add insult to that injury.  What amazes me even more is that company executives have found a way to stay even further ahead of the pace they already set.  As inflation continues to rise and negatively affect most of us, so rises out of the ashes like a phoenix a term called “Greedflation.”  Haven’t heard of it yet?  You will soon, don’t worry.  One definition of this term is ‘the idea that businesses are taking advantage of high inflation and the cost-of-living crisis by increasing prices beyond their own rising costs, in order to increase their profits’.  So, as inflation, and thus your cost of living, goes up, what do the people that run the companies that we shop at do?  They raise prices even higher so their profits don’t skip a beat.  In fact, in many cases, they are actually profiting MORE during this inflationary surge.  

Here’s a glaring example for you:  In 2022, 82% of car buyers paid more than MSRP for their vehicle, compared to only 3% in 2021, and around 0% in 2020.  And do you remember 2019 when you were able to haggle and bargain down the price of your car?  Bring it closer to home, I am sure you have seen the prices of many of your favorite food items get a bit out of control lately.  Companies often cite “supply chain shortages” to explain why they raise their prices, but I think the truth is they let nothing interfere with their profits.  There’s another, more familiar term for what companies have been doing…they’re price gouging, plain and simple.  

In an age where workers are standing up for their rights and unionizing more than ever, we have seen workers’ benefits and especially wages substantially increase.  Couple that ideology with the sharp increase in minimum wage, and you would think that workers are in the best financial situation in a very long time, right?  But after a two year pandemic, plus inflation, CEOs had plenty to pin the blame for their price increases already but threw in the costs of increased worker wages. The AFL-CIO’s annual Executive Paywatch Report, however, shows that workers’ real wages fell 2.4% in 2021, after adjusting for inflation, and we are still waiting for the 2022 numbers.  When inflation is 7.1% but workers’ wages rise just 4.7%, we are going the wrong way.

In the heart of the pandemic, our supermarket industry saw record profits.  They could have even sold  the furniture, fixtures, and equipment for a huge profit, but they wouldn’t have anywhere to put the groceries after.  That enabled your union bargaining committees to in turn extract as much money in wages for you as we could.  We hadn’t seen wage increases that size in a long time and it only happened because we stepped in and stepped up with your committees.  We fought to redirect some of those increased profits to the hardworking people who made it for the CEOs in the first place, YOU!  

But what about the workers that do not have a union fighting on their behalf?  These workers especially continue to suffer from the CEO wage gap, as there is no ‘watchdog’ or helping hand looking out for their interests.  Imagine what we could accomplish if even more workers took the step to unionize their workplaces?  While we may never completely abolish the wage gap, strengthening and educating the workforce can certainly help chip away at the greed many corporations display, and help spread the profits more evenly for everyone.

The rich will always find a way to get richer, Greedflation is proof of that.  We need to continue to fight to make sure they are not getting rich while your wages remain stagnant or worse yet — slide backwards because of inflation and greed.  Shame on anyone who has raised prices but not wages to match.  And shame on anyone who refuses to amit that inflation, plus inflated prices, equals less in real employee wage increases, which translates to their employees being worse off than before.  

We are here to hold greedy employers accountable.  To make sure that just like them, workers also earn more money year over year, and can have a profitable life of their own.  Local 1500 will never stop fighting to address any injustices that surround our members’ jobs.  We stand strong with our 15,000+ members, plus all of our sibling Locals in the UFCW and across all international unions within the AFL-CIO to continue to fight corporate greed and bring dignity to our jobs!