Which Swiss companies have the biggest gaps between high and low earners?
While Swiss wages are more equitable than those of most other European countries, there is still a significant disparity between the lowest and highest salaries in the country’s big companies, according to a new survey.
Wage inequality can either come about when income is unevenly distributed throughout a population, or, on a smaller scale within a given company.
Although Switzerland generally boasts strong pro-worker labour laws and salaries that are among the highest in the world, new research indicates that wage disparity is alive and well in many large Swiss companies.
The study, carried out by Unia labour union, shows that in 2021, executives of 43 largest Swiss firms earned an average of 141 times more than their lowest-paid employees.
The worst offender in terms of income disparity is Roche, where top executives earn 307 times more than their lowest-paid workers. The pharmaceutical giant is followed by UBS (221), Logitech (204), Nestlé (201), Alcon (197), and Novartis (195).
What is the study authors’ definition of a ‘low’ wage in this context?
In half of the 43 companies surveyed, Unia found that the lowest incomes are less than 50,712 francs per year.
"These salaries are significantly lower than the ‘low salary threshold’, which, for Switzerland, corresponds to 53,320 francs", the study reads.
While salaries of the lowest paid employees grew by only 0.5 percent between 2016 and 2020 (the last year for which official data is available), for the higher-ups the increase was 4 percent.
How does Switzerland compare to other countries in terms of income disparity?
Data published by the Federal Statistical Office (FSO) indicates that when it comes to salaries, Switzerland matches the EU’s median ratio of 4.9 — which means that the total income of the richest 20 percent of the population is 4.9 times greater than the total income of the poorest 20 percent.
This is the same ratio as in Germany.
By comparison, the ratio in Switzerland's neighbour, Italy, is much higher — 5.8 percent — France’s is 4.5 percent, and Austria’s 4.1.
Generally speaking, and income inequality notwithstanding, "the standard of living in Switzerland remains one of the highest in Europe", the FSO said.
This means that after adjustment for differences in price levels between countries, "the Swiss population's financial situation is more comfortable than that of its neighbouring countries and countries in the European Union".
This is the case even though the cost of living in Switzerland is higher than in most European countries, according to FSO.
READ MORE: EXPLAINED: Why Switzerland’s cost of living isn’t as high as you think