Compared To Company ProfitsWhen the public sees a salary that they consider to be too big, they are usually looking atonly half of the picture. It is impossible to look at just the salary, without taking any otherfactors into consideration. One must look at the amount of earnings, compared to theprofits of the company. For instance, Robert Allen, who runs ATT was recently pointed out by 60 Minutes asbeing an overpaid executive. Their major problem was that he had been responsible forlaying off 40,000 employees, while still managing to give himself a large pay increase. Atfirst glance, this situation may appear to be one involving a greedy and overpaid executive. However, upon closer examination, it proves to be much to the contrary. The situationwherein the 40,000 employees were laid off, was not a matter of getting rid of people foran unfounded reason. It was more a matter of getting rid of an excessively large workforce, and getting the same job done with fewer people. This not only benefited ATT, butalso, the customers receiving service from ATT. "For exactly the same service in 1996,the average family will be paying $11 less."1 This is due to the fact that the consumer'smoney was not going to a larger number of employees, but going directly to the minimalcost of performing the job. Robert Allen has a total salary of 20 million dollars. Thissalary seems to be extremely high when put as a statistic by itself. This changes, though,when you compare it to the total earning of ATT. His salary calculates to be 1/3,450 ofATT's gross. All of the sudden, the 20 million dollars does not seem like such a highfigure after all. Another factor that serves to make his salary a valid amount, is that evenif his total pay was split between all of the laid off workers, they would only receive about$500, not much more than a weeks pay. When all of the cards are on the table, a salary of20 million dollar starts to look quite reasonable.Top Executives Are...
