Thursday, December 17, 2020

Protecting Share-holders, not Workers

 According to an analysis by the Washington Post, 45 of the 50 most highly valued U.S. companies have "turned a profit" in 2020. Despite their financial success, 27 of those firms cut staff this year, laying off more than 100,000.

Instead of using the wealth produced by workers to keep employees on payroll, corporations "put Americans out of work and used their profits to increase the wealth of shareholders," the Post found. "Companies sent thousands of employees packing while sending billions of dollars to shareholders," the Post noted. 

Walmart distributed more than $10 billion to its investors during the pandemic while laying off 1,200 corporate office employees. Walmart was not alone. Apple gave back tens of billions of dollars to shareholders. Apple spent $41 billion buying shares and paying cash dividends between April and September, more than twice as much as the company with the next highest total, Microsoft

Salesforce,  a company sitting on more than $9 billion in cash and short-term investments which generated $2.7 billion in profit during the first six months of the pandemic, its CEO Marc Benioff, was a signatory to the Business Roundtable's 2019 statement on corporate purpose and a proponent of so-called stakeholder capitalism, is one of the executives who continued to prioritize the interests of shareholders in 2020 —laying off 1,000 workers despite a 28% increase in revenue compared to last year—even after promising not to do so during the pandemic's early stages. Layoffs "were announced one day after the software giant announced its biggest quarter of profit and revenue in history, sending its stock soaring 30 percent."

Gary Walker, a systems engineer who was one of 1,000 employees Salesforce laid off in late August, told the newspaper that "the choices that they make are governed by, essentially, maximizing shareholder value."

Chuck Robbins, chief executive of Cisco, a $180 billion software and networking giant, said large companies like his shouldn't lay off workers during a global crisis because, even in a bad year, they had the resources to maintain payrolls. Four months later, Cisco began implementing a plan to lay off thousands of employees.

"The majority of Americans who lost jobs this year were laid off from small businesses, many of which had no option but to cut workers to stave off financial collapse," the Post noted. "But larger companies actually laid off a greater portion of their workforces over that period—9 percent for large firms vs. 7 percent for smaller firms—despite having more resources to survive the downturn."

'Sick': Most Profitable US Companies Fired Workers, Enriched Shareholders During Pandemic | Common Dreams News

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