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CEO pay and stock buybacks have soared at the largest low-wage corporations

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Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#31

Post by missedthecue »

Hikikomori wrote: post #24
missedthecue wrote: post #9

Measuring median wage of Starbucks employees against the one time multi-year strictly performance based stock-option plan given to the new CEO is so blatantly dishonest I can barely read the rest of the article. Especially when Starbucks awards stock and healthcare plans to even part time baristas. Probably one of the better major employers of low skill labor in the world.

Is part of the performance keeping worker wages as low as possible?

No. If keeping worker wages as low as possible was the goal, they wouldn't award stock or healthcare benefits to part time workers in their kitchens.

The point is that poaching a new CEO from another company (in this case, Chipotle), and awarding him a pile of stock options if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account, and does not make anyone else poorer, except theoretically the shareholders, who were so excited to hire this new guy that the stock literally popped 20% when the news broke.

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#32

Post by JumpCrisscross »

FollowingTheDao wrote: post #18
tyleo wrote: post #6

It’s interesting to me this doesn’t self correct. I’d love to know if someone can explain why. E.g. presumably companies can pay people more if they capture less value themselves. Why can’t a company do that and just hire the best talent?

[flagged]

> self corrects with pitchforks. Does no one read history anymore?

The elites after the French Revolution were not only mostly the same as before, they escaped with so much money and wealth that it’s actually debated if they increased their wealth share through the chaos [1].

Like, in the country today, which wealth constituency is most pushing for overthrowing our republic?

[1] https://www.jstor.org/stable/650023

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#33

Post by GuinansEyebrows »

bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

> This from an advocacy group with a clear agenda

does this not describe literally every successful coordinated collective effort? can you be more specific about what you mean by this?

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#34

Post by VirusNewbie »

nielsbot wrote: post #12
bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

Key Points - While some policymakers have blamed immigration for slowing U.S. wage growth since the 1970s, most academic research finds little long run effect on Americans’ wages. - The available evidence suggests that immigration leads to more innovation, a better educated workforce, greater occupational specialization, better matching of skills with jobs, and higher overall economic productivity. - Immigration also…

what a weird way of rephrasing what the study actually says

"most academic research finds little long run effect on Americans’ wages."

Right, with this sentence being important right after:

"studies suggest that these gains come at the cost of short-term losses from lower wages and higher unemployment."

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#35

Post by fakedang »

bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

Doesn't matter here. The examples cited here are Starbucks and Ulta Beauty, neither of which are big on hiring illegal or foreign workers.

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#36

Post by bruceb »

simianwords wrote: post #28
bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

This is not true. Restrict supply too much and you can't build anything. Could you have built Nvidia by restricting supply? Probably not - so there seems to be a middle ground.

This is specifically addressing the type workers mentioned in the article. Restricting immigration of those who would compete with them. Which ain't going to be your Nvida type engineers.

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#37

Post by m00x »

sharts wrote: post #20
bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

Capital will just flow to where costs are less. We don’t see Nike opening factories in the US for this reason

Capital will flow to maximize total shareholder value, therefore projected revenue/profits.

Nike opens factories in low-cost areas because they're allowed to. Before Clinton, most things were built in the country. Profits were lower, but the wage gap was also much lower.

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#38

Post by arthurcolle »

missedthecue wrote: post #22
nielsbot wrote: post #10

Stock buybacks used to be illegal. It's a loophole way of paying employees at a lower tax rate than salary. HBR discusses some downsides of buybacks: https://hbr.org/2020/01/why-stock-buybacks-are-dangerous-for...

Stock buybacks were never illegal. Stock buybacks were how Buffett took control of a small textile mill called Berkshire Hathaway in the 1960s. What was not allowed was at-the-market buybacks in the open market. Corporations had to do tender offers at a fixed price, usually well above market price, in order to attract sellers to mail in their certificates. I'm not sure why that is necessarily better or helps anyone,…

I think they are actually bad because it enables messing with stock price in a way that is "explainable" when really it is just a bookkeeping exercise

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#39

Post by kacesensitive »

bruceb wrote: post #7

This from an advocacy group with a clear agenda. But if they wanted to raise wages they could just advocate for less immigration and robust enforcement. Restrict supply, wages will rise. But they don't.

Yeah no.

Immigration’s impact on wages, especially in the long term, is not as straightforward as “less supply → higher pay.” Multiple studies from the U.S. National Academies of Sciences and leading labor economists find that immigration has only small effects on native-born workers’ wages, and in most cases boost overall wage growth by fueling demand, entrepreneurship, and innovation. Restricting immigration might reduce competition in some low-skill job markets, but it can also harm industries that rely on labor shortages being filled, push up costs for consumers, and slow economic growth, which in the longer run counteracts any wage gains.

Re: CEO pay and stock buybacks have soared at the largest low-wage corporations

#40

Post by Fade_Dance »

tyleo wrote: post #6

It’s interesting to me this doesn’t self correct. I’d love to know if someone can explain why. E.g. presumably companies can pay people more if they capture less value themselves. Why can’t a company do that and just hire the best talent?

In business sectors where talent matters, the reverse process absolutely does take place, and it is a positive flywheel. Ex: take US tech. Stock issuance (as opposed to buybacks) is used as incentive to attract talent, which then drives growth and valuation, which makes the company more attractive for talent, in a reflexive cycle.

But many businesses are just optimizing for lowest labor cost when it comes to their main workforce. That's where you see the arguably exploitive situation above.

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