How Much Does a CEO Make?

There is perhaps no compensation package more controversial than the one paid to a chief executive officer. These professionals are essentially the leader of their corporate enterprise, guiding major policy initiatives and determining the company’s code of ethics as it pursues growth, profits, and new markets. Though many people associate CEO pay with out-of-touch, eight-figure salaries, the truth is that plenty of CEOs actually earn something closer to a high-ranking manager. It all depends where the CEO works, how big their company is, what their compensation package consists of, and how successful they have been in their position as the leader of a corporate enterprise.

Start Small

There’s no getting around it: The vast majority of CEOs are highly-paid managers who earn the highest of all salaries paid within a given company. That’s largely appropriate, however: CEOs are promoted because they have the best set of management skills available, and because their prior success within the company has set them up for great success at leadership and further corporate development.

For those companies that are small to medium in size, the average CEO can expect to earn a six-figure salary in the low 200s. In fact, the nationwide average CEO pay for mid-sized companies is currently $210,000 per year. That’s certainly a robust compensation package, and one that most people would be happy to accept with a promotion to their company’s most prestigious office. With that said, leaders of major corporations around the world often make this amount in just one or several days’ time.

Large Corporations: The Home of Massive CEO Compensation Packages

The mid-sized CEO doesn’t often get very much press coverage when it comes to defining their salary and broader compensation package. That honor typically falls on the shoulder of major CEOS who lead multinational conglomerates and massive American corporations. And it is these people who, despite their small size as a group, tend to skew the CEO pay scale toward the seven-figure or eight-figure range.

The average CEO salary for companies of this size and magnitude falls somewhere around $2.5 million per year. Generally, this salary is not inclusive of stock options and other benefits, some of which might add as much as $10 million extra to a CEO’s total compensation package and overall net worth. Most CEOs of such large corporations also receive so-called “golden parachutes” even if their stint at the company doesn’t work out, giving them a robust severance package that can further boost their salary numbers.

The Best States for CEO Employment and Salaries

A CEO’s earnings largely depends on the size of the company they work for and the length of their tenure in the position. To some extent, compensation also depends on the state where the company is headquartered. Currently, the highest-paid CEOs all live in California. The state ranks as the top one in the nation in terms of average CEO salaries.

Illinois, New York, Massachusetts, and Florida all round out the top 5 states in terms of the highest average compensation for chief executive officers. Other business-friendly states, including Texas, New Jersey, and Pennsylvania, are close behind in these rankings.

A Lucrative Position for Born Leaders

With salaries that start almost universally above $200,000 per year, the average CEO makes a healthy wage and is the top earner for their corporation. With the skills and experience required to pursue this position successfully, however, that salary should be considered commensurate with the nature of the position.