How Stock Buybacks Replace Raises

When a company spends billions buying back its own stock, who actually benefits? Lucas and Luna unpack a 2025 study from the Institute for Policy Studies showing that S&P 500 firms spent 54 percent of net income on buybacks over the past decade—while median worker pay rose just 17 percent. They examine how buybacks divert cash that could fund across-the-board raises or bonuses, using Microsoft's $60 billion buyback authorization as a concrete example. The hosts also explore the SEC's 2024 rule change requiring more buyback disclosure, and why some executives argue buybacks are a better use of capital than permanent payroll increases. This episode drills into the tension between shareholder returns and employee compensation, and what it means for the typical worker watching their stock-based comp grow while their paycheck stays flat. #StockBuybacks #ShareholderReturns #Compensation #PayEquity #Microsoft #SEC #InstituteForPolicyStudies #WorkerWages #CorporateGovernance #ExecutivePay #CapitalAllocation #Raises #Bonuses #StockCompensation #Careers #FexingoBusiness #BusinessPodcast #CompensationPodcast Keep every episode free: buymeacoffee.com/fexingo