DesignRush Ranks Lowest-Paying Sectors for U.S. CEOs

The average CEO salary in the United States in 2024 is $257,075.

However, this figure isn't one-size-fits-all, as CEOs in certain sectors only earn 30% of the average, raising concerns about the pay gap across all sectors. According to 2024's CEO Turnover Report, 47 U.S. CEOs resigned from their posts in April alone, with 44 of them working in the nonprofit sector.

While the exact reason for the recent CEO exits remains unclear, the latest study from the agency directory DesignRush reveals substantial wage disparities for CEOs in the public sector.

Key Findings:

• Government sector CEOs earn the lowest wages, averaging $151,920, with a wage ratio of 2.04 (double the average salary)
• CEOs in the nonprofit sector remain among the lowest paid with a salary growth of only 2.47%
• Construction (-6%) and Agriculture (-5%) remain volatile for CEOs with a massive drop in top executive pay

Underpaid CEOs by Industry in 2024

To provide a clear picture, we compared CEO salaries from 2019 to the latest figures for the fiscal year 2023, analyzing the wage growth of the last five years. 

Additionally, we looked at the wage ratio to measure the disparity between CEO salaries and the average worker's salaries within each industry. This ratio provides insight into income inequality within each sector.

Let's look at the findings:

1. Federal, State, and Local Government

• CEO Wages in 2023: $151,920
• Wage Growth 2019-2023: 7.59%
• Wage Ratio in 2023: 2.04

Government sector CEOs earn the lowest wages, averaging $151,920 in 2023, with a wage growth of 8% from 2019. The wage ratio is relatively low at 2.04, indicating a smaller disparity between CEO and average worker wages. This sector remains a consistent outlier in terms of lower executive compensation.

2. Accommodation and Food Services

• CEO Wages in 2023: $167,590
• Wage Decline 2019-2023: 10.85%
• Wage Ratio in 2023: 4.63

This sector saw the most significant decline in CEO wages, dropping by 11% to $167,590 in 2023. The wage ratio of 4.63 highlights a moderate disparity between CEO and average worker wages. The decline reflects the industry's cost-cutting measures.

3. Construction

• CEO Wages in 2023: $208,780
• Wage Decline 2019-2023: 5.55%
• Wage Ratio in 2023: 3.10

CEO wages in the construction sector decreased by 6%, down to $208,780 in 2023. Despite this decline, the wage ratio remains at 3.10, indicating a smaller disparity compared to other private sectors. The sector's volatility in demand and costs contributes to these fluctuations.

4. Educational Services

• CEO Wages in 2023: $213,710
• Wage Growth 2019-2023: 5.70%
• Wage Ratio in 2023: 3.19

CEO wages grew by 5.70% in the Educational Services sector, though average wages decreased by 3.03%. The wage ratio of 3.19 indicates a moderate disparity between CEO and average worker wages.

5. Other Services (except Public Administration)

• CEO Wages in 2023: $223,620
• Wage Growth 2019-2023: 2.47%
• Wage Ratio in 2023: 4.13

CEO wages in this sector increased by 2% to $223,620 in 2023. The wage ratio of 4.13 indicates a moderate disparity between CEO and average worker wages. The sector's diverse range of services contributes to a stable yet modest wage growth.

6. Agriculture, Forestry, Fishing, and Hunting

• CEO Wages in 2023: $226,760
• Wage Decline 2019-2023: 5%
• Wage Ratio in 2023: 3.40

CEO wages in this sector decreased by 5% to $226,760 in 2023, with a wage ratio of 3.40, showing a moderate disparity compared to other sectors. This sector often faces external challenges like climate change and market volatility, impacting wage stability.

7. Transportation and Warehousing

• CEO Wages in 2023: $239,780
• Wage Growth 2019-2023: 6%
• Wage Ratio in 2023: 3.70

CEO wages in this sector grew by 6% to $239,780 in 2023. The wage ratio of 3.70 indicates a moderate disparity between CEO and average worker wages. The growth reflects the sector's increasing importance and demand for efficient logistics and transportation management.

8. Healthcare and Social Assistance

• CEO Wages in 2023: $251,340
• Wage Growth 2019-2023: 16%
• Wage Ratio in 2023: 4.15

This sector experienced the highest wage growth for CEOs, increasing by 16% to $251,340 in 2023. The wage ratio of 4.15 indicates a higher disparity compared to other sectors. The significant growth reflects the increasing demand for healthcare services and the complexity of managing such organizations.

9. Wholesale Trade

• CEO Wages in 2023: $255,280
• Wage Growth 2019-2023: 2%
• Wage Ratio in 2023: 4.20

CEO wages in this sector increased by 2% to $255,280 in 2023. The wage ratio of 4.20 indicates a moderate disparity between CEO and average worker wages. The stable growth reflects the sector's role in distribution and supply chain management.

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These findings raise concerns surrounding the wage gap in executive leadership across different sectors, particularly within public services. Industries like the government and education sectors show smaller disparities between CEO and average worker wages.

In contrast, sectors like Accommodation & Food Services, and Construction illustrate more significant declines in CEO compensation, influenced by high competition for jobs and cost-cutting strategies.

Methodology

Data on wages was derived from the Occupational Employment and Wage Statistics (OEWS) survey provided by the Bureau of Labor Statistics (BLS). Data for average wages and CEO wages was extracted for each industry to calculate the wage growth and rankings.