The average FTSE 100 chief executive is now paid 122 times the median UK full-time worker, after executive pay in Britain’s leading firms hit a historic high, according to the latest research from the High Pay Centre.
The median pay for bosses at the UK’s top listed companies jumped to £4.58 million in the 2024-25 financial year – a 6.8% rise – triggering fresh debate on pay inequality and corporate responsibility, with Scottish business leaders voicing concern about the impact closer to home.
This trend signifies the fourth consecutive year that chief executives have received record-breaking pay. Additionally, it implies that the average FTSE 100 chief executive now earns 122 times more than the median full-time employee in the UK, according to the study.
“A feeling that the economy works for the enrichment of a tiny elite at the expense of wider society is an underrated cause of populist anger and support for extremist politics. Policymakers who fail to address this inequality are storing up some big problems for the future,” said Luke Hildyard, Director of the High Pay Centre.
10 years ago, the same thinktank found that “dysfunctional and disproportionate pay gaps between executives and ordinary workers are a big problem in Scotland”, and the issue has only increased ever since.
The High Pay Centre’s latest analysis found that 13 companies paid their chief executives more than £10 million last year, up from 10 previously. The report highlights aerospace firm Melrose Industries, whose CEO Peter Dilnot received a total package of £45.5 million in salary and bonuses, though a shareholder revolt blocked even larger payouts.
Critics argue that such large compensation packages are difficult to justify at a time when millions of UK workers, including many in Scotland, are feeling the effects of a prolonged cost-of-living crisis.
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“Every working person plays a part in producing Britain’s wealth. But while millions of low-paid workers are still feeling the effects of the cost-of-living crisis, people at the top are taking more than their fair share,” said Paul Nowak, General Secretary of the TUC.
Amid pressure from government and unions, the UK’s new Employment Rights Bill aims to improve workers’ pay bargaining rights and job security, including proposals to ensure trade unions have access to workplaces. The High Pay Centre has called for “bolder measures like representation for elected worker directors on company boards and caps on executive pay” to address the widening gap.
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