Rising Pay Gap in Switzerland

ZURICH (Reuters) – The income disparity between the highest- and lowest-paid workers in Switzerland has widened in 2023, according to a study by trade union Unia released on Monday.

Top managers now earn, on average, 143 times more than their lowest-paid employees, an increase from 139 times in 2022. UBS leads with the largest salary differential.

The issue of pay at UBS has become a focal point in Swiss politics. Finance Minister Karin Keller-Sutter criticized UBS Chief Executive Sergio Ermotti’s 2023 compensation of 14.4 million Swiss francs ($16.99 million).

UBS stated it provides salaries in line with market standards based on role, experience, and location. The bank has raised total salaries for employees in Switzerland, up through middle management, by 2.25%, exceeding increases seen across the financial sector.

Following UBS, Novartis ranks second and Nestlé third regarding pay gaps, though neither company provided immediate comments on the study.

In comparison, in Britain, the median FTSE 100 CEO earned 120 times more than the national median salary last year, as reported by the High Pay Centre think tank.

Unia highlighted that the current pay gap is the widest since 2019, when CEO salaries were 148 times higher than the lowest.

Economist Noemie Zurlinden stated, “The gaps between the highest and lowest paid workers are huge and getting bigger.” The report indicates that, despite companies’ substantial profits from dividend payouts and share buybacks, income inequality has persisted.

While top earners continue to increase their wealth, those on low and middle incomes are experiencing a decline in spending power due to stagnant real wages amid inflation. Zurlinden emphasized, “It cannot be justified that the CEOs earn so much more than ordinary workers. A better redistribution of the economic gains is especially important in times of rising costs of living.”

($1 = 0.8475 Swiss francs)