Energy
Which Companies Make The Most Revenue Per Employee?
Which Companies Make The Most Revenue Per Employee?
On average, companies in the energy sector make at least 2x per employee than others
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
The world’s largest companies have many similarities, but the size of their respective org charts is not necessarily one of them.
At the one extreme, companies such as Walmart require a massive workforce in the millions to run retail operations around the globe. But at the other extreme, an energy giant like Valero is able to generate $76 billion of annual revenue with just 0.4% of the employees of Walmart.
It raises the question: which types of companies make the most revenue per employee, and why?
Revenue Per Head
Today’s chart uses data on companies in the S&P 500 Index courtesy of analytics platform Craft.co.
Instead of plotting the information for all 500 companies, we focused on two groups of firms: (1) energy companies, which tended to skew towards the upper end of revenue per employee ratio, and (2) brands that you will be familiar with, like Netflix, Walmart, Goldman Sachs, Ford, or IBM.
The end result is an astonishing range, with companies making anywhere between <$100,000 per employee (Accenture, McDonald's, Starbucks, Marriott) all the way to >$7 million per employee (Valero Energy).
Industry Averages
Here’s a look at this same data expressed as averages at an industry level, based on the sub-sectors that make up the S&P 500:
| Rank | Sector | Avg. Revenue Per Employee |
|---|---|---|
| #1 | Energy | $1.79 million |
| #2 | Healthcare | $0.89 million |
| #3 | Utilities | $0.81 million |
| #4 | Consumer Staples | $0.70 million |
| #5 | Financials | $0.65 million |
| #6 | Telecommunications | $0.61 million |
| #7 | Materials | $0.60 million |
| #8 | Tech | $0.48 million |
| #9 | Consumer Discretionary | $0.42 million |
| #10 | Industrials | $0.32 million |
Note: this analysis excludes real estate companies
Interestingly, there is even a wide variance between sectors. Oil and gas companies make at least twice as much revenue per employee than the companies in all other sectors, while healthcare and utilities companies also have high ratios as well.
There is a plausible explanation for this large discrepancy, and it has to do with the cost of doing business.
Oil and gas companies have to spend billions of dollars on capital expenditures to build and maintain plants and rigs, while paying extra taxes and royalties. Healthcare companies have to spend a lot on R&D to stay competitive, while utilities must maintain vast amounts of infrastructure. At the same time, all of these sectors generally hire very specialized employees like engineers or scientists, which cost more than average.
Energy
Charted: 4 Reasons Why Lithium Could Be the Next Gold Rush
Visual Capitalist has partnered with EnergyX to show why drops in prices and growing demand may make now the right time to invest in lithium.
4 Reasons Why You Should Invest in Lithium
Lithium’s importance in powering EVs makes it a linchpin of the clean energy transition and one of the world’s most precious minerals.
In this graphic, Visual Capitalist partnered with EnergyX to explore why now may be the time to invest in lithium.
1. Lithium Prices Have Dropped
One of the most critical aspects of evaluating an investment is ensuring that the asset’s value is higher than its price would indicate. Lithium is integral to powering EVs, and, prices have fallen fast over the last year:
| Date | LiOH·H₂O* | Li₂CO₃** |
|---|---|---|
| Feb 2023 | $76 | $71 |
| March 2023 | $71 | $61 |
| Apr 2023 | $43 | $33 |
| May 2023 | $43 | $33 |
| June 2023 | $47 | $45 |
| July 2023 | $44 | $40 |
| Aug 2023 | $35 | $35 |
| Sept 2023 | $28 | $27 |
| Oct 2023 | $24 | $23 |
| Nov 2023 | $21 | $21 |
| Dec 2023 | $17 | $16 |
| Jan 2024 | $14 | $15 |
| Feb 2024 | $13 | $14 |
Note: Monthly spot prices were taken as close to the 14th of each month as possible.
*Lithium hydroxide monohydrate MB-LI-0033
**Lithium carbonate MB-LI-0029
2. Lithium-Ion Battery Prices Are Also Falling
The drop in lithium prices is just one reason to invest in the metal. Increasing economies of scale, coupled with low commodity prices, have caused the cost of lithium-ion batteries to drop significantly as well.
In fact, BNEF reports that between 2013 and 2023, the price of a Li-ion battery dropped by 82%.
| Year | Price per KWh |
|---|---|
| 2023 | $139 |
| 2022 | $161 |
| 2021 | $150 |
| 2020 | $160 |
| 2019 | $183 |
| 2018 | $211 |
| 2017 | $258 |
| 2016 | $345 |
| 2015 | $448 |
| 2014 | $692 |
| 2013 | $780 |
3. EV Adoption is Sustainable
One of the best reasons to invest in lithium is that EVs, one of the main drivers behind the demand for lithium, have reached a price point similar to that of traditional vehicle.
According to the Kelly Blue Book, Tesla’s average transaction price dropped by 25% between 2022 and 2023, bringing it in line with many other major manufacturers and showing that EVs are a realistic transport option from a consumer price perspective.
| Manufacturer | September 2022 | September 2023 |
|---|---|---|
| BMW | $69,000 | $72,000 |
| Ford | $54,000 | $56,000 |
| Volkswagon | $54,000 | $56,000 |
| General Motors | $52,000 | $53,000 |
| Tesla | $68,000 | $51,000 |
4. Electricity Demand in Transport is Growing
As EVs become an accessible transport option, there’s an investment opportunity in lithium. But possibly the best reason to invest in lithium is that the IEA reports global demand for the electricity in transport could grow dramatically by 2030:
| Transport Type | 2022 | 2025 | 2030 |
|---|---|---|---|
| Buses 🚌 | 23,000 GWh | 50,000 GWh | 130,000 GWh |
| Cars 🚙 | 65,000 GWh | 200,000 GWh | 570,000 GWh |
| Trucks 🛻 | 4,000 GWh | 15,000 GWh | 94,000 GWh |
| Vans 🚐 | 6,000 GWh | 16,000 GWh | 72,000 GWh |
The Lithium Investment Opportunity
Lithium presents a potentially classic investment opportunity. Lithium and battery prices have dropped significantly, and recently, EVs have reached a price point similar to other vehicles. By 2030, the demand for clean energy, especially in transport, will grow dramatically.
With prices dropping and demand skyrocketing, now is the time to invest in lithium.
EnergyX is poised to exploit lithium demand with cutting-edge lithium extraction technology capable of extracting 300% more lithium than current processes.
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