How Much Should Business Owners Get Paid? Last year, big-company CEOs were paid an average of 343 times what their workers made. How does that number make you feel?

By Carol Tice Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

How Much Should Business Owners Get PaidNo matter if the economy booms or busts, there's at least one thing you can consistently count on: CEO pay will rise.

Labor unions have made much of how executive pay has ballooned at the major public companies over the years -- particularly in relation to worker pay. In 1980, a typical company head made 42 times an average worker's pay. Last year, it was about 343 times that figure.

How does that number make you feel -- outraged? Or maybe happy for the top guy who's cashing in big?

When I read about mega-million-dollar pay packages, I think: How many millions does any one person need to earn in a single year?

One might argue that these big-company bosses would do better by investing more in rewarding their staff, driving better business growth and in the end better pay for all. Can it really be good to drain the business of that much cash, all to one person?

Henry Ford famously paid workers enough so they could save up and buy a Model T. But many companies these days seem to have forgotten this vital equation -- if workers don't have spending cash, the economy flounders, as there aren't enough buyers.

Although many companies have been shedding employee benefits have for decades, not every company thinks that course is sustainable. Take, for example, special events-production company Red Frog Events, which recently won a small business of the year award from the U.S. Chamber of Commerce.

The 100-employee Chicago-based company took home that prize, in part, because of its lavish benefits packages.

The company offer workers unlimited vacation days, pays 100 percent of their healthcare premiums, offers a month of sabbatical every five years, free lunch on Mondays and free dinner if they have to stay late, says Red Frog's chief innovation officer, Greg Bostron. In sum, the workplace is a creative, fun place where meetings are held in a tree house.

So it's no surprise that the company -- which puts on unusual footrace events -- is growing. They're able to attract top talent and workers rarely leave. They've grown to $60 million in revenue in just four years.

While not every small-business owner can afford to provide similarly lush benefits, they also don't typically take home eight-figure paychecks either -- often putting their pay on a more even keel with workers. That likely also helps as owners are usually there on the front lines, looking workers in the eyes every day.

Maybe big-company CEOs should have to do more of that.

Do you think the ratio of worker to owner pay matters? Weigh in with your opinion.

Carol Tice

Owner of Make a Living Writing

Longtime Seattle business writer Carol Tice has written for Entrepreneur, Forbes, Delta Sky and many more. She writes the award-winning Make a Living Writing blog. Her new ebook for Oberlo is Crowdfunding for Entrepreneurs.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Business News

AI Could Cause 99% of All Workers to Be Unemployed in the Next Five Years, Says Computer Science Professor

Professor Roman Yampolskiy predicted that artificial general intelligence would be developed and used by 2030, leading to mass automation.

Buying / Investing in Business

Big Investors Are Betting on This 'Unlisted' Stock

You can join them as an early-stage investor as this company disrupts a $1.3T market.

Buying / Investing in Business

From a $120M Acquisition to a $1.3T Market

Co-ownership is creating big opportunities for entrepreneurs.

Business News

Mark Zuckerberg 'Insisted' Executives Join Him For a MMA Training Session, According to Meta's Ex-President of Global Affairs

Nick Clegg, Meta's former president of global affairs, says in a new book that he once had to get on the mat with a coworker.