US CEO-to-Worker Pay Gap Widens Further in 2025

The income gap between chief executive officers and workers in the United States widened from 2024 to 2025, with CEOs at S&P 500 companies earning on average 312 times the median worker's salary. That is up from a ratio of 285 times the previous year, according to the annual Paywatch report released Thursday by the AFL-CIO, the largest federation of labor unions in the U.S.

The labor federation warned that such pay disparities risk broader consequences for the global economy. If CEOs focus on boosting their own earnings, they may pay less attention to the stability of their companies or the wider economy. "Excessive CEO compensation contributes to rising economic inequality," the AFL-CIO said. "It creates risks that CEOs will make short-term decisions to maximize their own pay, even if that harms the long-term health of their companies."

In its report, the AFL-CIO noted it had to set aside one outlier when calculating the CEO-to-worker pay ratio: Elon Musk, the world's richest person. In 2025, Musk earned $158 billion as CEO of electric-vehicle maker Tesla, or 2.5 million times the average salary of the company's employees. That sum even exceeded Tesla's full-year revenue of $94 billion.

The same year, Tesla reported a 3% drop in revenue. Vehicle deliveries fell about 9% as some consumers boycotted the company over Musk's role in President Donald Trump's second administration. Tesla also faced 11 vehicle recalls last year, affecting 745,000 cars.

During the first half of 2025, Musk headed the Department of Government Efficiency (DOGE), an agency created by Trump to oversee federal workforce and spending cuts. Beyond Tesla, he manages several other businesses, including social media platform X and rocket company SpaceX. In June, SpaceX's initial public offering (IPO) sent Musk's net worth soaring, briefly making him the first person in the world to hold a trillion-dollar fortune.

Including Musk, the average pay for a CEO at an S&P 500 company soared 1,700% last year to $3.1 billion. Excluding Musk, the rise was more modest. While the average CEO earned about $19 million in 2024, that figure grew 21% to $22.8 million in 2025—nearly double the average CEO compensation from a decade earlier.

The pay gap between CEOs and workers varies widely by industry. The biggest disparity is in manufacturing, where CEOs earned an average of $696 million, while production workers made about $93,000 on average—a gap of more than 11,000%. Tesla was the company with the largest pay gap in that sector, helping to drive the ratio higher. The second-highest gap was in arts, entertainment, and recreation, where executives earned an average of $24.6 million versus about $25,000 for workers, a 1,057-fold difference.

A striking example is the coffee chain Starbucks, where the average employee earned $17,279, only $1,629 above the 2025 federal poverty line. With CEO Brian Niccol earning more than $30 million last year, experts estimate the pay ratio there at 1,794 times. The AFL-CIO report also named employees of Amazon, Dollar Tree, FedEx, McDonald’s, and Walmart among the largest recipients of social benefits. Amazon CEO Andy Jassy earned 51 times the average employee, while McDonald’s CEO Chris Kempczinski made 1,082 times the average worker's pay.

Thursday's report also examined Trump's income in the first year of his second term. Trump's campaigns have leaned heavily on his business record, and he has consistently presented himself as the person best able to fix the country's economic problems. Critics, however, accuse him of profiting from the presidency through his brand or policies favorable to his business interests, including cryptocurrency.

The AFL-CIO report found Trump's income in 2025 rose 254% from 2024, before he returned to the White House. The $2.2 billion haul came mainly from World Liberty Financial, the Trump family's crypto venture, and sales of meme coins. According to the AFL-CIO, that amount was roughly 43,154 times the average U.S. worker's income last year, even as about 37% of American adults could not cover a $400 emergency expense.

In that context, U.S. consumer confidence fell 8%, with more anxiety about business conditions and personal finances, according to a University of Michigan report released Friday. The labor market is also weakening, as the U.S. economy lost 23,000 jobs in July, per the Bureau of Labor Statistics. The Conference Board, a nonprofit economic think tank, also showed confidence in the economy declining for a third consecutive month.