Growth Trends for Related Jobs
While no data exists on the average salary of fashion CEOs, the New York Times reports that CEOs made an average of $9,600,000 in 2010 and Styleite reports that CEO pay at top brands is in line with CEO pay in other industries. High CEO pay stands in contrast to pay for other workers in the fashion industry, who face stiff competition and years of meager pay before landing a job that offers a salary.
CEOs of fashion companies receive complicated compensation packages of which salary is only one part. CEOs often receive a salary in the hundreds of thousands of dollars as a guaranteed base pay. However, the majority of a CEO's compensation comes from bonuses of cash and company stock that a Board of Directors or other company management ties to performance. For example, in 2009, Urban Outfitter's CEO Glen Senk earned a base salary of $1,000,000, but the company awarded him an extra $2,000,000 bonus and stock worth $26,000,000.
CEOs made an average of $9,600,000 in 2010 due to huge improvements in sales and profits, even with limited hiring and a depressed market overall. Select fashion CEOs made tens of millions, but the median pay is most likely below the general CEO average, as Styleite's list of highly-paid fashion executives includes a few who made just above average. Furthermore, fashion depends more on consumers' disposable income than most other industries, and the slow economy still affects profits.
CEOs at fashion companies have challenging and unique jobs overseeing product lines based on highly subjective standards and constantly changing trends in taste and design, while managing corporate business structures. Few individuals manage to develop the qualities necessary to succeed as a fashion CEO and those that do are well compensated: in 2010, Mark Parker of Nike made $13,000,000, Ralph Lauren made $27,700,000 and Michael Jeffries of Abercrombie and Fitch made $36,300,000.
The few at the top contrast starkly with the tens of thousands at the bottom. The Bureau of Labor Statistics reports that most fashion designers freelance and hence are self-employed. Once established, some 31 percent manage to get salaried jobs at a fashion company, and average $61,160 a year. However, the BLS notes that competition is fierce and that the industry has little projected growth in jobs, meaning that in coming years more people are expected to compete for the same number of positions.
- "The New York Times"; The Drought Is Over (At Least for CEOs); Daniel Costello; April 2011
- U.S. Bureau of Labor Statistics; Occupational Outlook Handbook; Fashion Designers
- Styleite; How Many Millions Does Your Favorite CEO Make?; Justin Fenner; Jan. 2011
- Fashionista; Urban Outfitters CEO Made $29.9 Million in 2009; Lauren Sherman; April 2010
Calla Hummel is a doctoral student studying contraband in international political economy. She supplements her student stipend by writing about personal finance and working as a consultant, as well as hoping that her investments will pan out.