# News Roundup: Moonlighting and the cost-of-living crisis

- **Episode:** [105](https://agents.truthliesandwork.com/episodes/105.md) (2024-06-11)
- **Type:** news-roundup
- **Tags:** news, moonlighting, cost-of-living
- **Time:** 1:54–8:31 (start 114s)
- **Listen:** [https://truthliesandwork.com/105?t=114](https://truthliesandwork.com/105?t=114)

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[1:54] Al Elliott: Okay, Lee, let's kick off with you. What have you got?
[1:56] Leanne Elliott: Isn't this the thing I've seen? It's something that was brought to my attention a few weeks ago. We were talking about moonlighting on the podcast, Al. You remember moonlighting? If you've not heard before, you haven't listened to the episode, basically having a side hustle, employees having a side hustle. Um, well, the conversation continued on LinkedIn with quite a few different experts and HR professionals commenting and basically agreeing that given the current challenges with the cost of living crisis mass redundancies, general instability, it's not really reasonable anymore for employees to expect— sorry, for employers to expect their employees to be exclusive to their business. One expert made a really, really interesting point. Rita Ernst, she's a psychologist. You'll remember her from episode 34, How to Identify and Eliminate Toxic Workplace Cultures. She suggested that the inaction of executives has sanctioned the need for side hustles and moonlighting. And quoted some findings from Pew Research Center. Of course, I asked her for the article. This is what I've learned. Pew Research found that real wages for most US workers have stagnated, maintaining approximately the same purchasing power as they did 4 decades ago, which basically means the typical worker can buy the same stuff today as they could have bought in 1978. Or in other words, workers are earning more dollars, but the value of those dollars hasn't increased at all since 1978. A little bit shocking. You might be thinking, yeah, but Leanne, that's just how inflation works. And I don't know how inflation works, but I do have more data for you, which I think means that this is not inflation. For average workers, the Pew Institute found that the same pattern had not applied to CEOs. So if we look at some different research, research from the Economic Policy Institute, they found in 2021 the average CEO of one of the top 350 firms in the US was paid an astounding $27.8 million a year. That represents an increase of 1,460% between 1978 and 2021. That's according to the latest data available. That's even growth beyond stock market, stock market growth. The research went on to look at the ratio of CEO to typical worker compensation, right? So compared to a typical worker, how much more is a CEO being paid? In 1965, the ratio of CEO to typical worker compensation was 20 to 1. So CEOs earned 20 times more than the average worker. Fair, they're probably doing 20, 20 times as much in terms of accountability. But in 1989, that was 59 to 1. By 2020, that was 366 to 1, and by 2021, it was 399 to 1. Again, I'll play devil's avocado for you. You might be thinking, yes, but that's just because there's a shortage of really good CEOs, or they're just great CEOs that are more productive, or something else. Well, again, not really. CEOs are getting higher pay over time because their power— CEOs are getting higher pay over time because They have the power to set pay, and because much of it, about 80% on average, is stock related. So this report goes on to recommend various different things that we can do to readjust this ratio. So in terms of CEOs perhaps having pay cuts, of course they should pay more tax, or even that corporation tax should be higher for companies that have an excessively high CEO-to-worker pay ratio. Quite interesting. I'm not sure I'm up for all of those, but one that I can get on board with, which is mentioned, was their recommendation to allow greater use of say on pay, which allows a firm's shareholders to vote on top executives' compensation. We're seeing Elon Musk go through this at the moment. What about though— crazy idea, Al— what if the workforce have a say on pay that's linked to satisfaction? Um, satisfaction with pay equity, their jobs, bonuses, benefits, work-life balance, burnout. Manager effectiveness. What if employees voted on the salary package of their C-suite? Thoughts?
[6:18] Al Elliott: Hmm. Yes, I can see there being a big problem. Um, I also think that we're looking at data from the top 350 companies in the US rather than over the entire, which, let's be honest, that makes up 0.00001% of all of the companies in the world. So if you, if you're not careful, I think you end up Saying that all managers and all CEOs get paid far more than they— than the ratio is far more than actually just their employees. Whereas if you went to your typical— the Americans call it HVAC, we'd call it— we don't have air conditioning in the UK, but we'd call it sort of like a plumber or a plumbing firm. It might not— the disparity might not be quite as big. So I can, I can see that that on paper sounds horrific. Also, me as wanting to be a CEO and also quite liking money, I'd be like, cool, okay, well, that means I can make a lot of money as CEO. So I can see that as well. There's also the stock market thing we've talked about. You've said it's gone up quicker than the stock market, but the stock market has gone up pretty significantly, particularly the S&P since sort of like the '70s, '80s, consistently going up and up and up. So if 80% of their pay comes from the actual options they've got on the stock, I can kind of see, well, take that out the equation for a moment because that's not necessarily— it's kind of directly linked to the performance of the company, but it's not necessarily linked to their performance. How does that look?
[7:38] Leanne Elliott: And I, and I like that perspective, Al. And I too think there is an element of truth in that. If you're willing to, to have what is called a greedy job— it's been greedy job that's been termed— it takes a lot of time and sacrifice and compromise, then should CEOs be, be paid so much more? I think my, my issue is, is it's these same CEOs, it's these, these top 350 that are calling people back to the office, that are putting more restrictions on their time so side hustles are harder. It's those people that are basically role modeling that if you want to be successful and earn money to make a true difference in your life, to be financially independent, you have to be a boss. Therefore, that's the message I'm getting as an employee. So I will have a side hustle to become my own boss because that's the only way I'm ever gonna get 400 times more pay than I currently get right now