Unifor Leaderboard

While Canadian workers struggle, CEOs keep getting richer

A new report by the CCPA shines a light on the disturbing reality of class inequality and corporate greed in today’s Canada

Economic CrisisLabourCanadian Business

While living conditions across Canada decay and the future looks increasingly grim for many, the richest CEOs in the country continue to fatten their pockets at the majority’s expense. Image from Shutterstock.

A new report by the Canadian Centre for Policy Alternatives (CCPA) has shined a light on the disturbing reality of class inequality and corporate greed in today’s Canada.

Aptly titled “Canada’s new gilded age,” the report documents how in the face of deepening food insecurity, rising rent and housing costs, and the worsening “humanitarian crisis” of homelessness, Canada’s 100 highest-paid CEOs were paid a staggering $14.9 million, on average, in 2022.

So, while living conditions across Canada decay and the future looks increasingly grim for many, the richest CEOs in the country continue to fatten their pockets at the majority’s expense.

The CCPA report notes that 2022 was “another record-breaking year” for Canada’s richest CEOs, with their average pay of $14.9 million representing a new all-time high. “While the wave of inflation has been crashing down hard on regular Canadians,” writes author David Macdonald,

Canada’s 100 highest-paid CEOs have been riding it to another record-smashing year. Inflation presented a-once-in-a-lifetime chance for corporate Canada to jack up prices and pad their profit margins. As a result of these record-high margins, this report documents new all-time highs across the various metrics that we employ to track the compensation packages of Canada’s 100 highest-paid CEOs.

On average, these CEOs made 246 times more than the Canadian worker in 2022, another all-time high.

It must be noted that accelerating inequality is not just being driven by a few CEOs on the list—even the pay of the 100th richest CEO hit a record high in 2022. This means that, while the average minimum wage in Canada is around $15 an hour, “the equivalent minimum CEO wage for the top 100 is $3,220.”

The average CEO, however, collects much more hourly: $7,162. As Macdonald writes:

It takes just over eight hours in the new year for the top 100 CEOs to clock in an average of $60,600—what the average worker in Canada makes in an entire year. By 9:27 a.m. on January 2, 2024, Canada’s top CEOs would have already made $60,600 while the average Canadian worker will toil all year long to earn that amount of pay.

It is true that worker’s average salaries rose in 2022: $58,800 to $60,600. This is an increase of $1,800, less than Canada’s current average monthly rent. When adjusted for inflation, however, any meagre gains melt into air. In actuality, Canadian workers took a pay cut of four percent in 2022.

Chief executives, meanwhile, increased their average earnings by $623,000. This growth was also slower than inflation, but Canada’s top 100 CEOs obviously don’t have to worry about sliding into economic precarity.

The main driver behind increasing CEO wealth is “performance pay,” meaning “various types of bonuses paid to CEOs when companies perform well in areas like revenue, profit and stock prices.” Inflation is a major driver of CEO bonuses, as Macdonald explains:

Corporate Canada was, broadly speaking, using inflation as a cover to drive profits and margins way outside of historical norms. CEOs heading those companies were, in turn, rewarded for those historic profits with historic pay packages based on those record profits.

The report’s section on inflation is appropriately titled: “The circle of life: Inflation → profits → CEO bonuses.”

While the CCPA report focuses on CEO pay, its findings illuminate the extreme inequality that characterizes life in Canada (and worsens each year). The CCPA previously documented how the 87 richest families in Canada hold more wealth than the poorest 12 million Canadians combined. Estimates on the top one percent in Canada, meanwhile, assert that the Canadian ultra-rich control 25-29 percent of the country’s wealth.

It should come as no surprise that, in the words of Policy Note contributor Alex Hemingway:

Inequality is linked to worse performance on a wide range of health and social outcomes as international epidemiological research shows. Economic inequalities also contribute to inequalities in political influence, which skew public policy priorities towards the preferences of the rich, deprive governments of revenue for public investments and reinforce the concentration of wealth.

In Canada, these realities are manifest in affordable housing shortages, record-high food bank use, and the normalized authoritarianism of police in grocery stores, dispatched to criminalize the desperation of the food insecure. These trends are concomitant with the ballooning wealth of Canada’s richest and Canadian authorities’ utter disinterest in challenging corporate avarice. Merissa Daborn writes:

Food theft isn’t an indicator of criminality, but of a failing social system that creates the conditions to leave individuals with no alternatives. Police in our grocery stores shouldn’t signal a need to crack down on food theft, but rather inspire questioning about why police are in our grocery stores in the first place, and what can be done to get them out.

The Canadian social system has, in fact, failed. How can we call ourselves a functioning society when the hungry are arrested for stealing Loblaw food products at the same time Loblaw rakes in billions? How much longer will we pretend that corporate greed and the complicity of the capitalist state isn’t rotting the Canadian economy from the inside out?

At the end of the CCPA report, Macdonald notes: “Canada’s top marginal tax rates were once much higher than they are today. It’s not coincidental that during periods when income taxes were much higher on the wealthy, the gap between the rich and the rest of us in Canada was much lower.”

The report offers four recommendations for reducing CEO pay, and thereby ameliorating the devastating effects of class inequality in Canada.

  1. Create new top income tax brackets.
  2. Remove tax breaks for CEO bonuses over $1 million.
  3. Introduce a wealth tax on those who have over $10 million in wealth.
  4. Capital gains (profits made selling stocks) should be taxed the same as other income (currently only half of capital gains income is actually taxed as income).

Would these changes be enough? Likely not. But it’s obvious that something needs to give. While the bank accounts of Canada’s richest bloat with money that should be equitably distributed to all, food prices, housing costs, and homelessness are spinning out of control, disproportionately impacting the marginalized and oppressed: Indigenous peoples, people of colour, women and LGBTQ+, the working class in general.

All Canadians need to ask themselves: how much longer can we let this go on?

Owen Schalk is a writer from rural Manitoba. He is the author of Canada in Afghanistan: A story of military, diplomatic, political and media failure, 2003-2023.


UM Press 1 Leaderboard

Browse the Archive