It seems there's little connection between CEO pay and actual value added. Surely there are ways to balance actual worth/value added and have that better ratio'd with employee salary. There's a lot of research that shows paying employees more actually does make them happier and more productive. Like the other commenter said, there are a lot of complexities here. I'd love to see a simple video explaining something like "Why raising salaries also increases the cost of living" (inflation, basically) to explain to people (me) how it's actually all connected and what happens in more detail - why when I make more money it doesn't feel like I'm any richer.

Great video, Preet. Thanks for putting together this thoughtful analysis. It is clear CEO pay is out of control. The points you raise about worker pay not keeping pace are all true, however there is a lot more to get into there. Manufacturing and other blue collar jobs have been most decimated by outsourcing & globalization, however if we put aside that cohort entirely we still see wage stagnation in professional services like tech, consulting, law, and finance (albeit less stagnant than the blue collar!). There are many complexities there, but I think it often boils down to a general undervaluing of workers by the business executive class. Business lose millions every year due to low productivity, turnover, and other issues that could be alleviated by wage investments, however businesses are simply unwilling to make those investments and clearly would rather suffer those losses and put that money instead towards a high profile CEO

“It’s not one link on a chain that’s more important than the other..they’re all equally important!!!”…when a chain link gets credit for being strong..no one says that theirs only one link that they trust or give credit to…they give the entire chain credit “equally!!”…so a CEO or Executive performance is reflective of how dedicated & strong all the workers,labors work & sacrifice their “TIME” and “BODY” to reach record profits and record productivity/ record out put!!..which should in return increase pay for them also but 90% goes to the top instead!!

I would have added that while average worker pay has increased only 18% over 40 years, their productivity have increased significantly. Most folks today are more educated (a lot of it throught student loans), healthier, smoke less, women are more numerous in the workplace, etc.. So all these investments that the average workers make in themselves fail to deliver compensation wise, when compared to the previous generation. All the added economic gain has gone into stock dividends and CEO and other C-Suite compensation. My grandfather bought a house at 23 with a high school degree and a retail job. I’m 29, with 30k left to pay in student loans and I feel I will never be able to buy a house (I have a TFSA instead). When Forbes started it’s richest man list in 1984, the number 1 spot was held by Gordon Getty at 4.1 billions dollars. Today, we have a 50 fold increase in their wealth. I can understand why some are nostalgic of the protectionist era and vote Trump. It is a raw deal for the bottom 99%.

Great video as always, Preet. I don't think that having more women earning absurdly outsized CEO wages is the kind of feminist progress that I'd like to see. Exploitation by a C suite that's half female is still inequity. I think the small bit of leverage we are seeing workers have in the US with worker shortages in some industries is going to be the real key to changes. It can be very hard to do, but if more folks were able to claw together an emergency fund, we'd all be in much better positions to say no to exploitive work. An unbustable, headless union. Anyway I know this isn't THAT kind of channel, but interesting conversation.

That was a depressingly great video Preet. Thanks so much man.

Why should they be paid less? Who should decide the compensation size of the CEO? Shareholders, customers, some government entity? I think you are right, Preet, it is not straightforward at all. Also, I think we should look at it from a broader perspective, ie why a worker in Bangladesh/ Chad receives a salary 100-200x smaller than one in Switzerland/ US? Maybe the answer is simply - Capitalism. The goal of the company is to increase share value (or revenue) hence it needs to be competitive (ie, Amazon is one of the richest companies, yet offer bottom low salaries). I guess, it is safer "to buy" talented CEO rather than double the salaries of your workers. Image you are part of the board, would doubling workers salaries really significantly increase company revenue, compared to hiring executive with strong records? I think it is just the reality or current stage of the capitalism world. We are growing in a "chasing money" society. And we will extend this "stage" while we put so much value in money (or other extrinsic goods). P.S. Great video! I liked how you showed the sources instead cutting out of context a specific phrase, which is done so often. I like the animation and your way of illustrations. Thats an impressive job!

Happy New Year's - please put out more content, as long as it is appropriate for expansion of knowledge. In addition, it is beneficial for you, more context more followers. You got this brother!

CEO’s & Executive forget that they don’t work alone or achieve success solely by themselves or with just their skill set….they have a TEAM of workers,laborers & associates whom contribute their skills set also to carry out day to day operations to serve customers to keep the business profitable!!!….so how come their the only ones that get rewarded in a ridiculous financial way?!?!#ShareTheFinancialProsperity#ProfitSharingShouldBeBalanced

It’s just like when quarter backs and point guards get all the glory and not the rest of the team…as if CEO’s,Executives & fund managers are a one man/woman army!!!….if it wasn’t for the rest of the team no one would have succeeded!!!#TeamWorkMakesTheDreamWork#ShareTheProsperity#StopBeingSekfishAndGreedy!!

And the media starts questioning why Reddit groups like \antiwotk have become so popular. There is a clear divide, it’s growing and something has to be done to bring wealth distribution back to reality

YES!! CEO's get paid too much. I have to believe there are some competent, CEO-capable talent lurking in the Canadian banks who would be willing to do that job for $1m, not $12m. Why on earth are the bank CEO's all paid in the same range? oh yes, Lake Wobegon...

Hello...dada ..

An extraordinary and a depressing video though 😅.. Musk just made my monthly salary in less than A SECOND !!!

modern day slavery

CEOs are taxed at the highest marginal tax bracket. Hence there is more tax revenue if 1 guy in the 50% tax bracket makes $20 million compared to 1,000 workers making $20,000 each at a 20% tax bracket. So why complain ? There are a few privileged people who make a lot , for reasons others than just talent, and the rest of us have more or less iqual treatment. Let's say the goverment forces the CEOs' salaries down and increases the workers' salaries with a magic wand. Now there is a decrease in tax revenue (that leads to less public service) and the workers' have more money to spend. And they'll spend it all. As a worker myself, I compete with the other workers workers to buy good such as 2 bedroom appartment, chiken breast and Honda civic. Bilionaires don't spend their money (maybe 1 or 2% a year, if that). If they do, they don't buy 2 bedroom appartment, chicket breast and Honda Civic. So what they make doesn't influence my cost of living. So if the inequalities were reduced, would I have a better buying power ? No ! Let's just ignore the billionaires. They take money out of circulation because they'll never be able to spend it all, which reduces inflation and increases our buying power. And they pay for a good chunk of public services. I'm not thanksful to them. I don't recognize them any outstanding talent worthy of a billion dollar. I just say we wouldn't be better off if they didn't exist. Probably the opposite. If I'm cinical and rational, I want the worker next door to be worse off, not the CEO to worse off. What I need selfishly, is make just a bit more money that the average workers, so I can outbid them when buying a 2 bedroom appartment.