Glenn Kellow, the coal executive who led Peabody Energy through bankruptcy, just collected an estimated $15 million stock bonus. John Eaves at Arch Coal, another recently bankrupt coal giant, got an award valued at $10 million.
The view from the coal pits is far less rosy. An analysis of recent government data shows that the wage gap between the coal industry’s top executives and average coal workers has expanded, while low-end pay has stagnated.
From 2004 to 2016, the average annual wage for chief executives in the coal industry grew as much as five times faster than those of lower-paying jobs in the industry, like construction or truck and tractor operator jobs. Executive pay averaged $200,000, up 60 percent from $125,000, while paychecks for truck and tractor operators rose just 15 percent, to $43,770 from $38,060. Pay for construction jobs in mining rose just 11 percent, to $35,080 from $31,470.
Pay for chief executives in the coal industry also grew much faster, on average, than that of their counterparts across the wider economy, while the average pay for coal industry construction workers failed to keep up with similar jobs in other fields. The data excludes bonuses, share options and other perks, which often inflate executive compensation — and the pay gap — many times more. Mr. Kellow’s stock options in the last year, for example, are worth almost 350 times what a typical coal truck and tractor operator makes in a year.
“The company boards seem to think they need to keep executives from fleeing a sinking ship,” said Sarah Anderson, an executive compensation expert at the Institute for Policy Studies, a Washington research group. “But when you protect people at the top from risk,” she said, “you’re not incentivizing them to shift to another approach, like making a transition toward more renewables.”
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