How S&P 500 Firms Handled Dividends Amid Coronavirus - MagnifyMoney

Almost 6 in 10 Firms With Cuts and Furloughs Amid Coronavirus Maintained or Raised Dividends

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America’s largest public companies were expected to pay out more than half a trillion dollars to shareholders in 2020, but then the coronavirus pandemic hit. Now, there are 43 fewer companies in the S&P 500 paying a dividend to shareholders, compared with the 423 firms at the beginning of the year.

What does this mean for the futures of these companies? In some cases, layoffs and furloughs. But, according to MagnifyMoney’s analysis of data for the 500 publicly traded companies that comprise the S&P 500, 57% of the firms that announced layoffs or furloughs through June 24 have maintained or raised their shareholder dividends.

Key findings

  • At least 67 companies in the S&P 500 laid off or furloughed workers between the start of the coronavirus pandemic and June 24.
  • Only 21 of these companies with layoffs or furloughs reduced or suspended their dividend payments between March 11 and Aug. 5.
  • Two companies increased their dividends despite announcing layoffs and furloughs.
  • Thirty-six companies maintained their dividend payment levels despite layoffs or furloughs.

Where companies stand on dividends after layoffs or furloughs

Among companies that chose to opt for layoffs or furloughs in 2020, many maintained their current dividend, though a substantial number either reduced or suspended their dividends.

Dividend breakdown for companies with announced layoffs or furloughs
Increased DividendMaintained DividendReduced or Suspended DividendNo Dividend
Baxter InternationalAdvanced Auto PartsBoeingCarmax
IBMArcher-Daniels-MidlandDarden RestaurantsDish Network
AT&TDelta Air LinesLKQ
Baker HughesEstée LauderMohawk Industries
Best BuyFreeport-McMoRanTransDigm Group
C. H. Robinson WorldwideGapUlta Beauty
CaterpillarGeneral MotorsUnder Armour
ChevronHalliburtonUnited Airlines Holdings
CintasHilton Worldwide Holdings
Cisco SystemsKohl's
ComcastL Brands
CorningMarriott International
Emerson ElectricMGM Resorts
General ElectricOld Dominion Freight Line
Genuine PartsPVH
Hewlett PackardRalph Lauren
Honeywell InternationalRaytheon Technologies
Hormel FoodsRollins
IntelRoss Stores
Interpublic GroupSchlumberger
Leggett & PlattThe Walt Disney Co.
Leidos Holdings
Omnicom Group
PPG Industries
Republic Services
Royal Caribbean Cruises
Stanley Black & Decker
Textron Inc.
Union Pacific
Verizon Communications

Layoffs or furloughs between March 11, 2020, and June 24, 2020

In a typical year, S&P companies pay out between 30% to 40% of their earnings to shareholders in the form of a dividend. For the S&P 500, that amounted to $485 billion in 2019. But with S&P 500 earnings estimated to decline 23% in 2020, some firms are dialing back expectations, affecting the dividends they’re willing to distribute to shareholders.

Here’s a breakdown of each dividend category among companies that announced layoffs or furloughs from the time the coronavirus crisis began in March to June 24.

Increased dividend

Only two companies with announced layoffs or furloughs increased dividends once the pandemic began:

CompanyAnnualized dividend (March 11)Annualized dividend (Aug. 5)
Baxter International$0.88 per share$0.98 per share
IBM$6.48 per share$6.52 per share
  • Baxter International: JUST Capital’s COVID-19 Corporate Response Tracker noted that the medical products company announced furloughs, but it didn’t provide specifics. Baxter International’s dividend increase — announced in May — represents an 11% rise over the previous quarter. The Deerfield, Ill.-based company announced July 14 that its new quarterly dividend — $0.245 per share — would remain the same.
  • IBM: Armonk, N.Y.-based IBM didn’t announce layoffs until May — months into the pandemic — though the technology company didn’t specify how many employees were impacted. IBM announced in late April that it was increasing its dividend to $1.63 per share quarterly, or $6.52 per share yearly. It later announced in July that the next quarterly dividend would remain the same.

Maintained dividend

Thirty-six companies laid off or furloughed employees while maintaining their dividends. Here are job highlights from some of these companies:

  • AT&T: The Dallas-based wireless carrier was cutting 3,400 workers and shutting 250 stores, according to a mid-June announcement from a union representing AT&T workers.
  • Best Buy: In mid-April, the company announced that it would furlough about 51,000 employees, impacting nearly all of its part-time staff. It said at the time that 82% of its full-time employees would continue to be paid. The Richfield, Minn.-based electronics company announced in July that half of the furloughed workers were back in stores.
  • Chevron: The San Ramon, Calif.-based oil producer in late May said it expected to lay off 10% to 15% of its 45,000-strong workforce, about 4,500 to 6,750 employees.
  • General Electric: The Boston-headquartered industrial company was to lay off about 10% of its aviation workforce, it was announced in late March. By May, that percentage jumped to 25% — about 13,000 affected overall.

Reduced or suspended dividend

Twenty-one companies that announced layoffs or furloughs also reduced or suspended dividends once the coronavirus pandemic began. Here are some highlights among the companies:

  • General Motors: The Detroit-based automotive company said in late March that its 69,000 salaried employees would have 20% of their earnings deferred, starting in April, a move that came just after it suspended North American production. GM suspended its quarterly dividend — $0.38 per share — and stock buybacks in late April. Then in late June, GM announced it was laying off almost 700 employees at its Tennessee assembly plant.
  • Kohl’s: The Menomonee Falls, Wis.-based retail company announced in late March that it was furloughing about 85,000 of its 122,000 employees (nearly 70% of its staff). The company said in mid-May that it was suspending its $0.704 per share quarterly dividend.
  • L Brands: Victoria’s Secret and its parent company, Columbus, Ohio-based L Brands, announced in May that the lingerie and clothing retailer would be shutting 250 stores in the U.S. and Canada. The company had earlier, in late March, halted its $0.30 per share quarterly dividend.
  • The Walt Disney Co.: The Burbank, Calif.-based media and entertainment company in April reportedly began furloughing up to 100,000 workers. This occurred primarily in its theme parks, which accounted for about a third of its division’s revenue in 2019. Disney announced early in May that it was opting to skip dividend payouts — which had previously been $0.88 per share semiannually — for the first half of its fiscal year.

No dividend

Eight companies with no dividend payouts announced layoffs or furloughs, according to MagnifyMoney’s data. Notably, Chicago-based United Airlines said it could lay off 36,000 workers (nearly 40% of its 95,000 employees) in the fall if there isn’t a travel rebound. Richmond, Va.-based used-auto retailer CarMax, meanwhile, furloughed about 15,500 employees in April.

These Dividend Aristocrats laid off or furloughed workers

A Dividend Aristocrat is a company that has paid out higher yearly dividends for 25 consecutive years.

Sixty-five companies have increased their dividend annually for at least a quarter of a century, according to the latest count as of July 31, 2020. These Dividend Aristocrats are attractive to certain investors, such as retirees looking for a stream of income, because of that positive, proven track record.

However, 14 of these companies have announced job cuts or furloughs since the pandemic began:

Firms that have increased dividends for 25 years but cut or furloughed jobs amid coronavirus

Layoffs or furloughs have been announced at these firms that have at least a 25-year history of increasing dividends annually. Only one — Raytheon Technologies — reduced dividends.

CompanySectorAnnual Dividend per Share
AT&T Communication services$2.08
Genuine PartsConsumer discretionary$3.16
Leggett & PlattConsumer discretionary$1.60
McDonald'sConsumer discretionary$5.00
Archer-Daniels-MidlandConsumer staples$1.44
Hormel Foods Consumer staples$0.93
SyscoConsumer staples$1.80
Emerson ElectricIndustrials$2.00
Raytheon Technologies*Industrials$1.90
Stanley Black & Decker**Industrials$2.76
PPG Industries***Materials$2.04

* Reduced dividend from $2.94 per share
** Announced increase to annual dividend of $2.80, payable Sept. 15
*** Announced increase to annual dividend of $2.16, payable Sept. 11
Dividends paid as of Aug. 5, 2020

One company further stands out: Waltham, Mass.-based Raytheon Technologies. The aerospace company cut dividends while furloughing employees. The furloughs were announced in early May, alongside plans to cut $2 billion in costs.


MagnifyMoney examined the recent dividend-paying history of the 500 firms comprising the S&P 500. We then compared their increases, decreases and maintenance of dividend payouts to announcements of job layoffs or furloughs between March 11, 2020, and June 24, 2020. Layoff and furlough announcements were sourced from JUST Capital’s COVID-19 Corporate Response Tracker, Drafted’s layoff list and other news items. Dividend history, as of Aug. 5, 2020, is based on data from Nasdaq.

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