The non-profit Good Jobs First launched COVID Stimulus Watch. The website is a database of public traded companies awarded federal loans under the Paycheck Protection Program. The data collected shows that at least 16 of those corporations pay their workers less than the national median household income level. Five pay wages so low they fall below the poverty line for a family of four.
“The public has rightly been up in arms over large companies getting PPP loans intended for small business, but it is also troubling to see the funds going to low-wage and even poverty-wage employers,” said Good Jobs First research director Philip Mattera, who leads the work on Covid Stimulus Watch.
Good Jobs First collected the pay data from Securities and Exchange Commission filings called Form DEF 14A (or proxy statements) issued by publicly traded companies that have reported receiving PPP loans. Firms provide a figure for the median total compensation of their workforce as part of the calculation of the ratio of the compensation of their chief executive to that of a typical worker. Smaller public companies may choose not to disclose the worker pay amount and the ratio, though they still report CEO compensation.
Of the roughly 330 companies that have reported receiving PPP loans, 43 disclosed their median worker pay; seven of these are among the firms that are returning their loans because of public pressure.
The companies reporting median annual worker compensation below the current federal poverty line for a family of four ($26,200) include three with active loans:
- Drive Shack ($13,902)
- Applied Opto-Electronics ($15,620)
- Trans World Entertainment Corporation ($17,346)
Two more in that category are refunding their loans:
- Fiesta Restaurant Group ($14,241)
- Shake Shack ($17,032).
The pay rates are from 2019, except Drive Shack (2018) and Trans World (2017), which are the latest available.
The restaurant employers emphasize that their pay figures include part-timers, and Applied Opto-Electronics notes that its pay calculation includes employees in China and Taiwan. It provides a separate figure for U.S. workers only – $43,427 – which is still below the national median income level.
The other PPP recipients with pay rates below the national median income level ($60,293) are:
- Culp, Inc. ($29,269)
- Retractable Technologies, Inc. ($37,440)
- DMC Global Inc. ($40,661)
- Dawson Geophysical Company ($41,367)
- Enzo Biochem, Inc. ($43,512)
- National Holdings Corporation ($48,906)
- ZAGG Inc. ($52,458)
- RealNetworks, Inc. ($57,383)
Those in that category that have returned their loans are:
- Limoneira Company ($33,197)
- Ruth’s Chris Steak House ($33,330)
- AutoNation ($49,568)
“The PPP enables employers to keep workers paid, but we all know that low-wage workers find it necessary to rely on Medicaid, SNAP and other safety-net programs,” said Good Jobs First executive director Greg LeRoy. “Long ago, many states started attaching wage and benefit standards to economic development incentives – and raising their minimum wage to $15 an hour or better. Why should these forgivable loans – grants, in essence – from Uncle Sam require anything less?”