Revenue per employee is one measure of a company’s productivity. Some companies generate significant revenue per employee that runs into the millions of dollars. Others generate only a fraction of that. While it can suggest a company is struggling, many companies with lower revenue per employee thrive with employees that appear to be less productive.
In many instances, these companies are in the restaurant and hospitality industries. For example, McDonald’s paid the average crew members and cashiers only slightly more than the $7.25 per hour minimum wage, according to employee-submitted data from Glassdoor.com, an online career community.
A number of these businesses depend largely on labor from overseas. Such businesses include Amphenol, which produces electronic and fiber optic cables, and Cognizant, which offers IT outsourcing services. Often, such companies use foreign labor to provide low costs for their own businesses, as well as pass along cost savings to their clients.
Just because a company has relatively low revenue per employee does not mean it will stop hiring. As long as adding more employees continues to be profitable — returning more money to the company than it costs to find, train and pay a worker — businesses have an incentive to keep adding workers. A number of companies where the per-employee revenue is relatively low, such as O’Reilly Automotive and Starbucks, added a considerable number of jobs last year.
Based on figures from S&P Capital IQ, 24/7 Wall St. reviewed the companies with the lowest revenue per employee. In order to be consistent, we used net revenue figures as reported under U.S. generally accepted accounting principles. Employee totals used in this analysis are based on S&P Capital IQ measure of full-time equivalent employees. In some instances, S&P Capital IQ employee totals may include franchisee workers, a large part-time or hourly labor force, or a largely foreign-based workforce. We also reviewed financial information published in company presentations, filings with the U.S. Securities and Exchange Commission (SEC) and metrics calculated by Morningstar. Darden Restaurants was excluded from this analysis, due to the recent divestiture of its Red Lobster chain.
These are the 10 companies with the least valuable workers.
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