So how can a company spend more on buybacks than it earns?

“These companies are borrowing or are using other cash reserves to fund buybacks,” Tung and Milani wrote. The restaurant industry alone could have afforded to give workers “25 percent more each year if those corporate funds were spent on wages instead.”

The researchers didn’t yet have access to comprehensive industry data since the Trump administration’s corporate tax cuts went into effect. But it did note that in the first quarter of 2018, S&P 500 companies spent a record-breaking $187.2 billion in stock buybacks.

Critics argue this practice contributes to income inequality and wage stagnation. After Trump’s tax cut, the economy approached full employment. But real wages fell 1.8%, indicating that corporations tend not to invest in employees even in times of economic growth and low taxes.

To once again ban stock buybacks, Senator Tammy Baldwin (D-Wi.) introduced a bill dubbed the Reward Work Act.

“The surge in corporate buybacks is driving wealth inequality and wage stagnation in our country by hurting long-term economic growth and shared prosperity for workers,” Sen. Baldwin said in a press release.

Just like with recent corporate tax cuts, proponents of stock buybacks boast of its job-creating and wage-boosting benefits.

“Instead, public companies in the U.S. are spending increasing and unprecedented amounts of cash on repurchasing shares of their own stocks. Yet workers see nowhere near such a boost,” wrote Tung and Milani.