Saturday, August 15th, 2009   4:42 am | Author: Bob | Economy, Work/Employment | Add Comment
Tags: corporations, jobs, share buyback
The corporate share buyback has accelerate recently as the markets tanked.
While this may be a good thing for corporate executives it is a terrible thing for those searching for jobs in this economy.
An article in BusinessWeek this week points out that with the jobless rate hovering around 10% it is unconscionable that companies are buying back shares instead of using that money to retain, hire or even expand their businesses.
Many of the share buyback plans wind up enriching their top level management teams with stock based compensation.
The BW article points out that
“The amount of money spent on buybacks is staggering. From 1997 through last year, 438 companies in the Standard & Poor’s 500-stock index spent $2.4 trillion on them. In 2007, as profits soared, the average buyback bill for each was about $1.2 billion—a record amount. And faced with a dramatic drop in their combined net income in 2008, ..continue reading