Top American executives earn fat salaries despite recession

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The Independent Online
NEW YORK (Reuter) - America's top executives, criticised for their fat salaries and lavish perks, earned more money than ever last year despite a stagnant US economy, according to a survey released yesterday.

The findings in the latest issue of Business Week magazine showed that the severe recession last year did not stop top executives from wallowing in more money than ever - about four times what their counterparts in Japan earned.

America's highest-paid chief executive, Thomas Frist Jr, pulled in dollars 127m running Hospital Corp of America, a healthcare conglomerate. He made that astronomical sum at a time when the high cost of healthcare has become a potent political issue.

The average salary for a chief executive at a big US corporation was dollars 3,842,247 - that is 56 per cent higher than in 1991.

By contrast, an average worker earned dollars 24,411, a teacher made dollars 34,098 and an engineer dollars 58,240.

Even to get on Business Week's top- 10 list of the highest-paid chiefs this year, an executive had to haul in more than dollars 22.8m.

'Only a few years ago, that would have been enough to capture the top slot,' the magazine said.

Business Week also published a second survey showing that top corporate chiefs in Japan, widely perceived as the United States' main economic rival, earn just one-fourth of what their US counterparts rake in.

The richest was Hiroshi Yamauchi who, as head of Nintendo, earned dollars 6.3m. But the average salary was just dollars 872,646, and the gap between executives and workers or schoolteachers was far narrower than in the US.

Such lavish US paycheques have raised the ire of shareholders, who have criticised companies for pumping up salaries as earnings and stock prices fall.

President Bill Clinton, heeding a public outcry over executive salaries, pledged in last year's presidential campaign to raise taxes on the most extravagant compensations.

Sanford Weill, chief executive officer of Primerica Corp, was number two on the list with a salary of dollars 67.6m. Charles Lazarus, head of the Toys 'R' Us toy shop chain, ranked third with dollars 64m, while another healthcare executive, Leon Hirsch of US Surgical Corp, was fourth with total compensation of dollars 62.1m.