What Industry Has The Fastest Growing Revenue Per Employee?

Each year, we release our Revenue Per Employee rankings for the S&P 500, the 500 largest American companies listed on the NYSE or NASDAQ. Revenue Per Employee (RPE) can be a measure of how efficiently companies utilize human capital. In this report, we will examine the top performers and the worst performers and compare to our rankings from last year.


Before we dive into the company rankings, we looked at the average Revenue per Employee by sector, to see from a broader perspective which industry has the highest human capital efficiency.




Energy & Utilities remains the top performing sector in terms of Revenue per Employee and the only sector with an average Revenue per Employee greater than $1M. Healthcare, Mobile & Telecommunications, and Financial Services sectors are also performing well.


In addition to the absolute numbers, we also analyzed the average growth rate across sectors since FY17.




All sectors saw positive growth in Revenue per Employee in FY18 compared to FY17. Food & Beverage, although the lowest performer in terms of Revenue per Employee at $95K per employee, had the highest growth at 22% year-over-year. Energy & Utilities, the top performer for FY18 Revenue per Employee at an average of $1.7M per employee, also exhibited high growth at 12% year-over-year.


Next, we look more closely at how specific companies are performing. The table below shows the top 25 companies by Revenue per Employee (Revenue per Employee) in 2018 in the S&P 500, along with how their Revenue per Employee compared to 2017.




Energy company, Valero Energy Corporation, tops the chart at $11.4M in Revenue per Employee at the company. Energy companies, in general, dominate this ranking for their human capital efficiency, with 17 out of the top 25 companies in the Energy sector, including Phillips 66, Cabot Oil & Gas, EOG, HollyFrontier, ONEOK, and Exxon Mobil. Three Healthcare companies, AmerisourceBergen, Cardinal Health, and McKesson, appear on the list, as well as two Financials companies, Everest Re Group and CBOE Holdings. The sole Technology company to appear on the list of top 25 companies by Revenue per Employee was video subscription giant, Netflix.


In contrast, the table below shows the 25 companies with the lowest Revenue per Employee in 2018 in the S&P 500, along with how their Revenue per Employee compared to 2017.




Similar to the rankings in 2017, Consumer Discretionary companies top the rankings of worst performing companies in terms of Revenue per Employee. These companies typically require larger employee headcount to staff brick-and-mortar locations to support their operations. For example, food service companies, like Darden Restaurants, Chipotle Mexican Grill, Starbucks, and McDonald’s, all appear at the top of the rankings with the lowest Revenue per Employee. Similarly, as we explored in our previous report, consultancy companies, like Accenture and Cognizant, require large teams to staff engagements and performance is largely tied to how many consultants they have to offer services to clients.


Next, we look at which companies are making the largest increases in their human capital efficiency. The table below shows the 25 companies with the highest growth in Revenue Per Employee in 2018 compared to 2017.




Nektar Therapeutics, a biopharmaceutical company, tops the list with 219% growth in their Revenue per Employee since 2017. Energy companies, which were the top performers in terms of absolute numbers, also rank highly for growth in Revenue Per Employee. Interestingly, Yum! Brands, parent company of KFC, Taco Bell, and Pizza Hut, was able to increase their Revenue per Employee by 70.8% in the past year. However, this was actually due to a large decrease in headcount from 50,354 in 2017 to 32,076 in 2018, according to their annual reports.

The table below shows the 25 companies with the greatest decline in Revenue Per Employee in 2018 compared to 2017.




Two payments companies, Total System Services (known as TSYS) and Global Payments, appeared high on the list for largest decline in Revenue per Employee since 2017. Hasbro, the large toy manufacturer, saw an 18.2% drop in Revenue per Employee in the wake of the Toys-R-Us liquidation. The Healthcare sector, although with high performance in absolute numbers of Revenue per Employee, did also see large decreases in Revenue per Employee, representing 7 out of the 25 worst performing companies.


Finally, we look at Technology companies to see which out of the S&P 500 Technology companies had the highest Revenue per Employee for 2018.



Apple led the rankings, as the only Technology company with over $2M in revenue generated per employee at the company. Facebook and Alphabet, the parent company of Google, both appeared high on the list with over $1M in revenue per employee. Overall, the average RPE for the Technology sector was just under $700,000 and these Technology companies saw 7.3% growth on average from 2017 to 2018. 


Key takeaways:


  • The fastest growing companies in terms of Revenue per Employee from 2017 to 2018 were: Nektar Therapeutics, Pioneer Natural Resources Company, PVH, Cabot Oil & Gas Corporation, and Sempra Energy. Each saw over 70% growth in Revenue per Employee since the previous fiscal year, with Nektar Therapeutics topping the ranking at 219% growth. 
  • Energy companies continue to have high revenues compared to employee headcount, representing almost 70% of the top 25 companies with highest Revenue per Employee. Energy & Utilities also had the highest average Revenue per Employee on the sector level, and also saw high growth since FY17.
  • Consumer Discretionary companies have high requirements for human capital to support revenues and therefore, have low Revenue per Employee. Food & Beverage companies, including franchise restaurant companies, had the lowest Revenue per Employee on the sector level, but did see high growth at 22% since FY17.


Note: We excluded a handful of organizations, primarily real estate investment trusts, from our rankings to eliminate a skew in our data, as these companies have very high revenues and low employee headcount due to the nature of their business. The companies we excluded from the list include: Host Hotels & Resorts, Welltower, HCP, Federal Realty Investment Trust, Ventas, Realty Income Corporation, Boston Properties, Alexandria, Duke Realty Group, Kimco Realty Corporation, and Regency Centers.




About Craft:


Craft is a machine-learning powered data and analytics platform building the ‘Source of Truth’ on companies, and mapping the global economy. We organize data from thousands of sources to provide comprehensive, up-to-date sector and company profiles, ranging from early-stage to the largest companies in the world.


As the economy, and nature of work continue to undergo massive transformation, Craft’s mission is to provide context to help people discover and evaluate companies and opportunities. Our platform is used for supply chain intelligence, investment analysis, customer lead generation, and competitive benchmarking.


We welcome your feedback. Please feel free to contact us at hello@craft.co.






AmerisourceBergen
HQ
Wayne, US
Employees
20,000↑ 6% increase

AmerisourceBergen provides pharmaceutical supply chain distribution and pharmacy management solutions.

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Cabot Oil & Gas
HQ
Houston, US
Employees
483↑ 4% increase

Cabot Oil & Gas Corporation is an independent North American natural gas producer.

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Cardinal Health
HQ
Dublin, US
Employees
50,000

Cardinal Health is a health care services company.

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Devon Energy
HQ
Oklahoma City, US
Employees
4,900

Devon Energy is an independent energy company engaged in the exploration and production of oil and natural gas.

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EOG Resources
HQ
Houston, US
Employees
2,800↑ 6% increase

EOG Resources explores for, develops, produces and markets crude oil and natural gas primarily in major producing basins.

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Everest Re Group
HQ
Hamilton, BM
Employees
1,276

Everest Re Group, Ltd is a world leader in property and casualty reinsurance and insurance, offering innovative products, responsive service and unsurpassed financial strength.

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Exxon Mobil
HQ
Irving, US
Employees
71,000↑ 3% increase

Exxon Mobil Corporation explores and produces crude oil and natural gas.

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Hess
HQ
New York, US
Employees
1,708↓ 18% decrease

Hess is a global independent energy company primarily engaged in the exploration and production of crude oil and natural gas.

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HollyFrontier
HQ
Dallas, US
Employees
3,622↑ 36% increase

HollyFrontier Corporation operates as an independent petroleum refiner in the United States. The company operates in two segments, Refining and HEP.

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ONEOK
HQ
Tulsa, US
Employees
2,684↑ 9% increase

ONEOK is a diversified energy company and the general partner of ONEOK Partners, one of the nation's largest publicly traded master limited partnerships.

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Phillips 66
HQ
Houston, US
Employees
14,200↓ 3% decrease

Phillips 66 is an energy manufacturing and logistics company with midstream, chemicals, refining and marketing, and specialties businesses.

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Valero Energy
HQ
San Antonio, US
Employees
10,015

Valero Energy is an independent petroleum refining and marketing company.

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Cognizant
HQ
Paris, FR
Employees
285,800↑ 2% increase

Cognizant is a provider of information technology, consulting, and business process outsourcing services.

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Darden Restaurants
HQ
Orlando, US
Employees
180,656↑ 2% increase

Darden Restaurants, through its subsidiaries, owns and operates full-service restaurants.

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Diamondback Energy
HQ
Midland, US
Employees
711

Diamondback Energy is an independent oil and natural gas company.

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Hilton Worldwide
HQ
McLean, US
Employees
169,000↑ 4% increase

Hilton Worldwide is a hospitality company, that owns luxury and full-service hotels and resorts, extended-stay suites, and focused-service hotels.

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Nektar Therapeutics
HQ
San Francisco, US
Employees
618↑ 22% increase

Nektar Therapeutics is a stage-clinical biopharmaceutical company.

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