ARI SHAPIRO, HOST:
For the first time, many American workers can find out how their salary compares to the company's CEO and to a median employee at the company. These disclosures were part of a 2010 Dodd–Frank Act. Theo Francis has been looking at what the numbers show us. He's a reporter for The Wall Street Journal. Welcome.
THEO FRANCIS: Good to be here.
SHAPIRO: How much can you learn from these broad numbers?
FRANCIS: They're pretty interesting. You really get a good sense of how a company is paying its employees. There can be a lot of differences across companies, and these numbers aren't necessarily directly comparable in every case. But they certainly provide some insight into what a lot of Americans are making at large companies.
SHAPIRO: What are the broad themes that emerge?
FRANCIS: You see a real difference by industry. So industries do tend to kind of cluster around one another. For example, retailers tend to have much lower median pay and much higher pay ratios than energy companies and utilities.
SHAPIRO: Dodd-Frank passed eight years ago. Why did it take this long for the information to come out?
FRANCIS: Well, there was a lot of corporate resistance to providing these numbers. Companies really didn't want to provide them. Certainly there was some concern about how it would look, about how employees would respond. There was also a real sense that this was going to be a complicated endeavor. But certainly, there was also some concern that, you know, companies might look bad.
SHAPIRO: Well, do the companies look bad when you look at these numbers?
FRANCIS: Well, whether it's bad or good of course is in the eye of the beholder. You certainly do have some very wide gaps in some cases between the CEO pay and the median employee's pay. The widest we saw in the more than 50 companies we looked at was Marathon Petroleum, where the CEO made about 935 times the median employee. A big part of that is that Marathon Petroleum owns the Speedway gas station chain.
So they have a number of gas station and convenience store employees. About 32,000 of their 34,000 employees are retail employees, who don't make all that much.
SHAPIRO: We've known for a long time that CEOs make a lot more money than a typical worker. Practically, does it make a difference if the CEO makes a hundred times or 900 times as much as a median employee?
FRANCIS: Well, again, that depends on where you sit. Certainly we have been seeing the ratio of CEO pay to employee to worker pay rise over the years. There's been a lot of concern about that in many quarters. So I think one argument goes that you shine a light on something, people pay attention to it. If people pay attention to it, maybe they'll be more thoughtful about it.
SHAPIRO: Is there any way to see if higher-paid CEOs are working for better-performing companies, whether it's, like, merit-based pay?
FRANCIS: So that certainly is something that I think you'll see a lot of examination about. You know, the new thing here is the median employee pay. There has been a lot of research about CEO pay over the years. And frankly, a lot of studies have found there isn't much correlation between what a company pays its CEO and how the company performs over the long term. Over the shorter term, there can be more correlation.
But the most recent study I saw over 10 years, there really wasn't much difference.
SHAPIRO: If someone listening works for a publicly traded company and wants to see how their salary compares to the CEO or to a median employee, where can they find that information?
FRANCIS: In most cases, it'll be in the company's proxy statement. This is a document - used to be mailed, it can be emailed to investors. You can also find it online. The Securities and Exchange Commission at sec.gov has a tab on its website that says filings and that gives you some ways to look up a company.
SHAPIRO: But it sounds like there's not one central database where you can, like, search by company name or something like that.
FRANCIS: Not yet. I'm sure these will develop over time.
SHAPIRO: Theo Francis, thanks so much.
FRANCIS: Thank you.
SHAPIRO: He's a reporter for The Wall Street Journal. Transcript provided by NPR, Copyright NPR.