Nvidia Corporation (NASDAQ:NVDA) and Advanced Micro Devices, Inc. (NASDAQ:AMD) are engaged it what might be the fiercest corporate competition around. Trying to figure out which company is worthy of your hard-earned dollars when both stocks are so volatile truly is a difficult task.

In May, I predicted that NVDA stock would hit $200 before AMD stock hit $16. In mid-August with the two stocks in a neck-and-neck race, I recommended investors forget about Advanced Micro Devices and buy SPDR S&P Semiconductor (ETF)(NYSEARCA:XSD) instead. Not quite as exciting but a little less volatile was my rationale.

However, for those who don’t or won’t buy ETFs, I’ve got another way to decide which stock is the better buy.

Job Creation Boosts Stock Prices

Call it my new fascination but recently I’ve come to appreciate companies like Amazon.com, Inc. (NASDAQ:AMZN) who create jobs by the thousands and in the process enrich its shareholders including Jeff Bezos, the on again, off again, world’s richest person.

Over the last decade, Amazon’s added 327,500 people to its workforce, a 24-fold increase in the number of employees. It’s no wonder that its stock’s achieved an annualized annual return over the past decade of 27.2% through Sept. 11, 2017

Job creation stimulates a company’s stock price like nothing else I can think of except perhaps the earnings produced by the jobs.

Compensation Also Tells a Story

Job growth is indicative of how a company’s business is performing. How it compensates its people both at the top and all the way down to the low-person on the totem pole is indicative of how it views its employees.

So, I want to know two things about AMD’s compensation relative to Nvidia’s. First, how much was CEO Lisa Su paid in its latest fiscal year compared to Nvidia CEO Jen-Hsun Huang? Secondly, what does that represent as a percentage of the overall salaries of the company?

Between the jobs situation and the compensation picture, it should be a little clearer which is the better stock to own.

Job Growth Past Three Years

AMD had 8,200 employees at the end of December 2016. It had 10,671 jobs at the end of 2013, a 23.2% decline in its direct workforce, which explains why it’s undergone a turnaround process that Su’s currently undertaking.

Nvidia had 7,282 employees as of January 29, 2017.  It had 8,808 employees at the end of fiscal 2014, a 17.3% decrease in its direct work force, slightly less than AMD’s reduction in headcount.

Neither of those declines is a mystery to most investors who follow the industry. I’m just trying to make an apples-to-apples comparison.

So, AMD generated $520,976 per employee in its latest fiscal year compared to $948,915 for Nvidia, a difference of 82%. On the bottom line, it’s even worse with AMD losing $60,610 per employee compared to a profit of $228,783 per Nvidia employee.

Nvidia’s done a better job than AMD utilizing its workforce to generate profitable growth.

CEO Compensation Matters

AMD’s CEO got paid $27.0 million in 2016 which includes $15.3 million in shares that vested this past year. Nvidia’s CEO got a whopping $51.2 million in the latest fiscal year with $39.0 million for option and stock awards that vested this past year.

Considering Nvidia CEO Jen-Hsun Huang is delivering record profits for the company, its shareholders are less likely to be upset with the founder making a bit more coin than the AMD CEO.

I’m not sure I can say the same about Lisa Su.

While by all accounts she’s a very talented engineer and CEO, that’s a lot to pay for a money-losing operation. But as they say, “Pay peanuts, get monkeys.” The future will tell us if the AMD compensation committee got it right.

Nvidia’s operating expense as a percentage of revenue was 30.8% in the latest fiscal year, 410 basis points less than AMD.

The only downside for Nvidia when it comes to compensation is the fact Huang’s $51.2 million compensation is 2.4% of its $2.1 billion in operating expenses compared to 1.8% for AMD, which means he’s getting a bigger piece of the pie than Su is.

Bottom Line – AMD Stock vs. Nvidia Stock

Nvidia’s managed to generate more from less while growing revenues at an incredible pace, a pace that clearly won’t last forever. AMD, on the other hand, has begun to turn the corner and may soon look a lot like Nvidia when it comes to the bottom line.

Do I think it’s enough to favor AMD stock over Nvidia? I do not.

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.