U.S. companies cut thousands of workers while continuing to reward shareholders during pandemic
Source: Washington Post
Business
U.S. companies cut thousands of workers while continuing to reward shareholders during pandemic
Five companies paid a combined $700 million to shareholders while cutting jobs, closing plants.
By Peter Whoriskey
May 5, 2020 at 10:51 a.m. EDT
Since the coronavirus pandemic was declared, Caterpillar has suspended operations at two plants and a foundry, Levi Strauss has closed stores and toolmaker Stanley Black & Decker is planning layoffs and furloughs. ... Steelcase, the office furniture manufacturer, and World Wrestling Entertainment have also both shed employees.
While thousands of their workers are filing for unemployment benefits, these companies rewarded their shareholders with more than $700 million in cash dividends. They are not alone. As the pandemic squeezes big companies, executives are making decisions about who will bear the brunt of the sacrifices, and in at least some cases, workers have been the first to lose, even as shareholders continue to collect.
Executives say the layoffs support the long-term health of their companies, and often the executives are giving up a piece of their salaries. Furloughed workers can apply for unemployment benefits. But distributing millions of dollars to shareholders while leaving many workers without a paycheck is unfair, critics argue, and belies the repeated statements from executives about their concern for employees welfare during the coronavirus crisis.
Caterpillar, for example, announced a $500 million distribution to shareholders April 8, about two weeks after indicating operations at some plants would stop. The company declined to say how many workers are affected. ... “We are taking a variety of actions globally, but we aren’t going to discuss the number of impacted people,” Caterpillar spokesperson Kate Kenny said in an email.
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Peter Whoriskey
Peter Whoriskey is a staff writer for The Washington Post whose investigative work focuses on American business and the economy. Previously, he worked at the Miami Herald, where he contributed to the paper's coverage of Hurricane Andrew, which was awarded a Pulitzer Prize for public service. Follow https://twitter.com/PeterWhoriskey
Read more: https://www.washingtonpost.com/business/2020/05/05/dividends-layoffs-coronavirus/
David Fahrenthold Retweeted
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@PeterWhoriskey
: Caterpillar, Levi Strauss, Black & Decker, World Wrestling Entertainment announced thousands of job cuts since the pandemic began.
They've also rewarded shareholders more than $750 million in dividends in recent weeks.
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Full disclosure: I own shares of CAT.
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