Jamie Dimon is not doing too badly. Last week, the chairman and chief executive of J.P. Morgan was allocated a 35% pay rise for 2015. This was his first hike for two half years, but Dimon’s previous pay hike in 2013 increased his pay by 75%.
While Jamie is being feted with fabulous pay increases, Lloyd Blankfein and James Gorman at Goldman Sachs and Morgan Stanley, are being handed pay cuts. The two men had their pay reduced by 4% and 7% respectively in 2015.
A new study by a student at the University of Arkansas suggests the pay changes are the wrong way around: in the interest of pay fairness, Dimon should have had his pay cut.
Using median pay data from Glassdoor and CEO compensation for 2014, the student produced the following ranking for CEO pay as a proportion of median employee pay. At 352 times the J.P. Morgan median of $79k, Jamie Dimon’s 2014 compensation was particularly large compared to his staff. At Goldman Sachs and Morgan Stanley, the proportions were ‘merely’ 282 and 289 respectively.
It might be argued that Dimon’s pay is bound to be a higher ratio of employee compensation because J.P. Morgan employs an army of retail bankers in the U.S. However, the same could be said of Citi where, at 231, the discrepancy in compensation was far lower.