U.S. Pay Discrepancy Widening

Limited Supply: The gap between executive salaries and pay of clerical workers in the U.S. rose nearly 20 percent during the past year, making it the third-fastest-growing pay discrepancy in the world, according to a report by Philadelphia-based Hay Group, a management consulting firm. Hay studied data on 12 million employees from 61 countries to determine average pay differentials for management employees and those in clerical and support jobs. The countries were ranked in descending order based on the size of their pay gap. The quest to find top-notch management material is inflating U.S. salaries at a faster pace than at any time in recent history, although the pay gaps here and in Western Europe remain “relatively small compared to the rest of the world,” according to Hay. However, from 2006 to 2007 the U.S. moved sharply up the rankings from 50th place to 43rd place with a spike of 18.4 percent, according to Hay. The trend could be stymied, however, if recessionary fears come to fruition. Populating the top third of the list were fast-growing economies, where the battle to recruit from a limited talent pool is inflating salaries beyond normal market rates, according to Hay.