Employee Stock Ownership Plans (ESOPs)

Rethinking Community Economic Development Beyond “Rent or Own”

Changing the ownership picture to build community wealth

Crossposted from Rooflines: The Shelterforce Blog

Although the notion of building wealth through home ownership has taken a beating in recent years due to the Great Recession, ownership more broadly is still seen as a key factor in building wealth. So says the Greenlining Institute. So finds a recent study authored by Thomas Shapiro and colleagues at Brandeis University’s Institute on Assets and Social Policy. Even the Housing and Economic Development Commission of the National Baptist Convention agrees.

Worker-Owned Companies Class of 2013

A review of some of last year's newly employee-owned companies

2013 was a good year to become a worker-owned company. Although just a selection of some of the newest worker-owners on the block, we highlight 17 new and existing businesses that were founded as or transitioned into worker-ownership in 2013. If these businesses are local to you, we encourage you to support and welcome your newly worker-owned neighbors.

Read more about Worker-Owned Companies Class of 2013...

The Maine Employee Ownership Network

The Maine Employee Ownership Network aspires to connect people of common interests and complimentary skills that are also interested in creating democratically governed businesses to build community wealth, stimulate economic growth and foster civic engagement. Read more about The Maine Employee Ownership Network ...

The Rise of Community Wealth Building Institutions

More people are turning to economic alternatives in which new wealth is built collectively and from the bottom up

Crossposted from Policy Network, and later published on the London School of Economics website, this blog is part of a debate event hosted by Policy Network in London, UK, that was reviewed in OurKingdom by grassroots activist James Doran:    

Five years after the financial crisis economic inequality in the United States is spiraling to levels not seen since the Gilded Age. While most Americans are experiencing a recovery-less recovery, the top one per cent of earners last year claimed 19.3 per cent of household income, their largest share since 1928. Moreover, income distribution looks positively egalitarian when compared to wealth ownership.

Asset Sharing Through “Inclusive Capitalism” Gains National Attention

Can Ownership Sharing at the Workplace Really Address Growing Inequality?

Last month, PBS NewsHour’s Business Desk featured an essay by Chris Mackin with the consulting group Ownership Associates entitled “The Alternative American Dream: Inclusive Capitalism.” Mackin uses the term “inclusive capitalism” as an ownership sharing proposition – one that is about creating a new relationship between employees and their workplace based not on a “sense” of ownership but on actual, tangible ownership. 

Employee Ownership Reduces Layoffs and Saves Taxpayer

Two low-cost strategies states can implement to advance ESOPs

Many of the benefits of employee ownership are quite apparent. Through owning a portion of stock in her or his company through an Employee Stock Ownership Plan, or ESOP, an employee is part owner and receives not just income, but has the opportunity to build wealth that would otherwise be unavailable in a traditional workplace. As a result, employee-owners have a greater financial stake in seeing the business succeed, which increases employee motivation and reduces the need for costly management oversight.

Democracy Collaborative Offers Paid Internship

Work with us on newsletters and community-wealth.org

We are pleased to announce a new intern position at The Democracy Collaborative that will focus on the Community-Wealth.org newsletter and adding web content. For further details, please see the position description below. Remember to submit your applications by August 30!

Cross Company

Headquartered in Greensboro, Cross Company provides products, services, and engineering solutions focused on machine automation, process control and instrumentation, fluid power technologies, and systems integration.  Founded in 1954, Cross became an ESOP company in 1979, and 100 percent employee-owned in 2006.   Today it boasts 200 employee-owners and serves customers across nine southeastern states.  Recognizing its commitment to employee-ownership and meaningful employee participation, The Carolinas Chapter of the ESOP Association—a nonprofit membership organization of ESOP companies—named Cross the 2011 Carolinas Chapter ESOP Company of the Year.

Anderson & Associates (A&A)

Founded in 1968, Anderson & Associates (A&A) is a 100 percent employee-owned professional services design firm specializing in civil and environmental engineering, surveying, and planning.  It has about 85 employee-owners and four offices across Virginia, West Virginia, and North Carolina.  Established in 1989, its Greensboro office specializes in engineering planning and design.  A&A places special emphasis on community involvement, with its employee-owners volunteering between 5 to 20 hours a month at a range of local nonprofit organizations.

Macroeconomic Impact of S ESOPs on the U.S. Economy

Alex Brill

In this recent report, Alex Brill of Matrix Global Advisors quantifies the macroeconomic impact of S-corporation Employee Stock Ownership Plan (ESOP) companies in 2010. Using publicly available data from the Department of Labor, the report finds that S-corporation ESOP companies account for 1.4 million jobs, $77 billion in labor income, $246 billion in output and $27 billion in tax revenue nationwide. The author argues additionally that the structure of these ESOPs leads to greater firm longevity as well as higher wages, greater job stability, and increased retirement plan contributions. Furthermore, the report shows that S-corporation ESOP companies are more resilient in an economic downturn, resulting in positive impacts for workers, customers, neighborhoods, and local economies. 

Worker Co-op New Era Windows Opens For Business

From sit-down strikes to state subsidies
Photo courtesy of Brendan Martin/The Working World

Last week, the New Era Windows cooperative celebrated its opening in a former Campbell’s Soup building in Chicago, the culmination of a hard-fought struggle by workers to save their livelihoods. Their well-documented struggle began in 2008 when the workers of Republic Windows and Doors occupied the factory to keep it from closing, attracting national attention. Read more about Worker Co-op New Era Windows Opens For Business...

Applied Research Associates, Inc.

Headquartered in Albuquerque, Applies Research Associates, Inc. (ARA) is an employee-owned international scientific research and engineering company, focusing on national security, infrastructure, energy and the environment, and health solutions.  With over 1,400 employees, ARA boasts that one of their greatest strengths is to recruit and retain high caliber employees from diverse technical backgrounds.  Through their ESOP, ARA buys stocks on behalf of employees, which allows them to share directly in the success of the business. 

Done Right, Eliminating Food Deserts Result in Community Oases

Building community wealth every step of the way
Pogue’s Run Grocer Mural, an initiative of the Indy Food Co-op. © Indy Food Co-op
Building healthy, vibrant and sustainable communities requires more than “bottom up” solutions. The importance of community ownership to ensure that projects that start at the bottom result in lasting community wealth for the people involved is often missing from the discussion. The local foods movement provides examples that illustrate the importance of this ownership principle in practice.

Democracy Collaborative Presents to Illinois Governor's Task Force

Public session April 24 on community wealth building
Next week in Chicago, Democracy Collaborative executive director Ted Howard will present testimony before the Governor's Task Force on Social Innovation, Entrepreneurship, and Enterprise. The presentation will focus on a set of actionable policy recommendations to help position Illinois as the nation’s leader in community wealth building. The meeting will take place in room 314 at Roosevelt University’s Walter E. Heller College of Business, 430 S. Michigan Avenue, Chicago, at 4 p.m. on Wednesday, April 24, 2013.

The Impact of Employee Ownership and ESOPs on Layoffs and the Costs of Unemployment to the Federal Government

Corey Rosen

In a recent paper for the National Center for Employee Ownership, Corey Rosen finds that people who work for employee-owned companies are much less likely to be laid off than those who do not. Analyzing data from the 2010 General Social Survey, Rosen shows that 12.1 percent of all working adults in the private sector reported being laid off in the last year compared to just 2.6 percent of those respondents who says they own stock in their company through some kind of employee ownership plan. Rosen estimates that during that year the implied federal savings from the lower layoff rates of employee owners is $23.3 billion and that the implied savings for ESOPs and stock bonus plans alone is $13.7 billion.