New Report Spotlights Low-wage Employers that Spend More on Stock Buybacks than on Capital Expenditures and Retirement Accounts

Washington, D.C. — A new Institute for Policy Studies report reveals staggering stats on the disparities within the 100 S&P 500 corporations that had the lowest median worker pay levels in 2023, a group we’ve dubbed the “Low-Wage 100.” 

Key findings:

1. From 2019 through 2023, the Low-Wage 100 spent $522 billion — over half a trillion dollars — on stock buybacks 

• Lowe’s led the charge on buybacks, a financial maneuver that artificially inflates CEO stock-based pay and siphons corporate dollars out of worker wages and long-term investments. The company spent $42.6 billion on buybacks — enough to have given each of the chain’s 285,000 employees an annual $29,865 bonus for five years.
• Home Depot ranks second, with $37.2 billion on share repurchases between 2019 and 2023. That outlay would have been enough to give each of Home Depot’s 463,100 employees five annual $16,071 bonuses. The big box store’s median pay stands at just $35,131.

2. From 2019 through 2023, nearly half of Low-Wage 100 companies — 47 in all — plowed more corporate cash into buying back their own shares than investing in capital improvements

• Buybacks-CapEx gaps were huge even among tech firms within the Low-Wage 100. Johnson Controls, a producer of “smart building” technologies, spent $8.8 billion more on buybacks than on CapEx over the past five years. Semiconductor manufacturer Analog Devices spent $6.2 billion more. Both firms pay more than half of their employees less than $50,000 per year. 

3. The 20 largest U.S. employers in the Low-Wage 100 have spent — over the last five years — nine times as much on stock buybacks as on employee retirement plan contributions

• AutoZone has the largest buyback-retirement benefits gap. From 2019 through 2023, the auto parts chain spent 92 times more on repurchasing its own shares stock than on employee retirement security.
• Chipotle ranks second on the Low-Wage 100 buyback-retirement benefits gap list, spending 48 times as much on CEO pay-inflating buybacks as on 401(k) plan contributions over the past five years.  

4. The average CEO-worker pay ratio at Low-Wage 100 firms narrowed from 603 to 1 in 2022 to 538 to 1 in 2023, but median pay levels remain extremely low

• Worker struggles for fair compensation have helped increase the Low-Wage 100’s average median pay by 9 percent, from $31,672 in 2022 to $34,522 in 2023 (not adjusted for inflation). Average Low-Wage 100 CEO pay has dipped slightly, from $15.3 million in 2022 to $14.7 million last year.
• Ross Stores has both the lowest median worker wage and the widest pay gap. In 2023, CEO Barbara Rentler hauled in $18.1 million, 2,100 times as much as the $8,618 pay that went to her the retailer’s median compensated employee, a part-time store associate.

“At a time when our country is deeply divided on so many issues, Americans have enormous common ground on the problems of extreme CEO-worker pay gaps,” says report author Sarah Anderson, director of the IPS Global Economy Project and co-editor of the IPS site Inequality.org. “Poll after poll shows that Americans across the political spectrum are fed up with overpaid CEOs and want lawmakers to take action.” 

This 30^th edition of the annual IPS Executive Excess series highlights three particularly promising areas of policy reform that are gaining legislative traction: 

• Taxing and restricting stock buybacks 
• Subjecting corporations with excessive levels of CEO pay to higher tax levies
• Using federal contracts and subsidies to discourage wide corporate pay gaps

Read the full Executive Excess 2024 report, including tables with detailed data on the Low-Wage 100 corporations: https://ips-dc.org/report-executive-excess-2024 

Press contacts:

Sarah Anderson, sarah@ips-dc.org

Olivia Alperstein, IPS Deputy Communications Director, olivia@ips-dc.org, (202) 704-9011 

About the author: Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies and co-edits the IPS web site Inequality.org. She is a veteran executive compensation expert whose analysis has been featured recently in the Associated Press, CBS News, the New York Times, and many other outlets. She also testified before the Senate Budget Committee in June 2024. 

About the Institute for Policy Studies

The Institute for Policy Studies is a multi-issue research center that has conducted path-breaking research on executive compensation for more than 20 years. IPS also provides a constant stream of inequality analysis and solutions through our Inequality.org web site and weekly newsletter.

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