Sundar Pichai took home $226 million in 2022 as Google sacked 12,000 employees

Many economies around the world are not in a great state. People, especially those in the tech industry, are losing their jobs. Companies are so much in a cost-cutting quest that they are stopping free snacks, laptops, and other services. But none of that seems to have had an impact on the multi-million dollar earnings of its CEOs and other top executives. 

Google's parent company Alphabet's new filing on Friday showed that CEO Sundar Pichai was paid nearly $226 million in 2022. The massive earning by Pichai came even as Google laid off some 12,000 employees from its global workforce. The company also put breaks on services such as free snacks, laptops, and more. 

Google $GOOG announced plans to eliminate 12,000 positions (6% of its workforce) but its CEO Sundar Pichai makes over $200 million (over 800 times the median employee's pay)

Is a $200 million salary justified due to being a valuable asset to the company?

— Andrew Lokenauth (@FluentInFinance) April 22, 2023

What do we know about Sundar Pichai's salary? 

• Pichai announced in January 2023 that he will take a significant pay cut after laying off thousands of employees. It was not clear how much pay cut he would be taking. 
• But regardless of the pay cut announced by Pichai this year, the Google CEO earned far more than the year before, over 800 times the median salary of an employee at Google. 
• The $226 million payout from Google to Pichai is largely made up of the stock award portion, which amounted to $218 million. 
• Pichai receives the stock award on a three-year schedule. He received $281 million in 2019. 
• The $226 million payout in 2022 also included a $2 million base salary and over $5 million in private security detail.

My favorite part of this story is that Google CEO Sundar Pichai’s personal security detail alone costs $5.94 million a year. Utterly crap management, layoffs, and silly high exec pay. pic.twitter.com/m0InE01eao

— Matt Stoller (@matthewstoller) April 21, 2023

• In comparison, the median total compensation of a Google employee was $279,802 in 2022.
• In terms of those making minimum wage in California ($15.50), it would take 40 hours of the work week with no time off for 7,000 years to make the kind of money Pichai made in just 2022.

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The compensation package of CEOs of big companies has become a touchy subject in the period of layoffs. It's not just Pichai's salary that came under scrutiny. 

Tim Cook

• Apple CEO Tim Cook also announced pay cut by 40% in 2023 after earning $100 million in 2022 and 2021. He requested for a pay cut after drawing criticism from shareholders.

Apple CEO Tim Cook made $99.4 million in 2022

In 2023, he will take a substantial pay cut and earn $49 million pic.twitter.com/SZdd738NKE

— Apple Hub (@theapplehub) January 14, 2023

Mark Zuckerberg

• The Meta CEO takes home just $1 annually in base salary. However, he's the 15th richest person in the world as per the Forbes Richest list. His net worth of $76 billion is mostly made up of stock holdings. 
• But that's not all, as Zuckerberg embarked on what he calls the "year of efficiency" by laying off some 11,000 employees, the company increased spending only on his personal security cover by $4 million, totaling $14 million.

Personally not a fan of how Zuck announced the Meta layoffs pic.twitter.com/RRyv24mHDL

— John W. Rich (Wealthy) (@Cokedupoptions) April 19, 2023

Chris Kempczinski

• McDonald's CEO Chris Kempczinski nearly $11 million in 2020 even as his company missed performance targets. Then, three years later, the company started laying off its corporate employees. 
• According to reports, Kempczinski made 1,189 times more than the median McDonald's employee salary in 2020. 

Noel Quinn

• HSBC CEO Noel Quinn took a 14% hike in his pay package in 2022 even as the bank cut its annual bonus pools for bankers by 4% the same year. 
• Quinn's package increased from 4.9 million pounds to 5.6 million pounds in 2022. Reuters reported that his total package could reach 10.5 million. 

What are the pay cuts for?

The pay cuts announced by the likes of Sundar Pichai and Tim Cook in view of the economic slump and layoffs don't seem to make a dent in their overall compensation. Much of the pay cuts are in the base salary of a few million dollars. However, over 80% of the compensation given to the likes of these CEOs comes from their stock options, and not the base salary. 

A study by the Economic Policy Institute revealed that the increasing CEO compensation and other executives have fueled the growth of the top 1% and the 0.1% while widening the wealth gap between the very high earners and the bottom 90%. The high compensation for the executives has also meant fewer economic gains for the ordinary. 

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