Dear Professors Chen and Chen –
It was great to see the piece in Fortune. Worker cooperatives are indeed a great idea, but, unfortunately despite the many millions that have been spent to promote them in the last few years, there are still only about 8,000 worker coop members, 2,000 in just one of them. By contrast, employee ownership through employee stock ownership plans (ESOPs) includes 14 million workers with $1.4 trillion in assets. The 100 largest majority ESOP owned companies (most 100% ESOP owned) have over 700,000 employees and the smallest company on the list is 1300 (the largest is Publix with 220,000). ESOPs have lots of tax advantages to companies, sellers, and employees and are financed but by employees but future tax0dedyctvle profits. This is an infinitely more scalable model. ESOP companies pay more, provide 2,2 times the retirement wealth, grow faster, and lay people off at one-third or less the rate of other companies. You can learn more about ESOPs at http://www.nceo.org. I hope this will be if interest.
COMMENTS
BY Corey M Rosen
ON May 21, 2021 12:33 PM
Dear Professors Chen and Chen –
It was great to see the piece in Fortune. Worker cooperatives are indeed a great idea, but, unfortunately despite the many millions that have been spent to promote them in the last few years, there are still only about 8,000 worker coop members, 2,000 in just one of them. By contrast, employee ownership through employee stock ownership plans (ESOPs) includes 14 million workers with $1.4 trillion in assets. The 100 largest majority ESOP owned companies (most 100% ESOP owned) have over 700,000 employees and the smallest company on the list is 1300 (the largest is Publix with 220,000). ESOPs have lots of tax advantages to companies, sellers, and employees and are financed but by employees but future tax0dedyctvle profits. This is an infinitely more scalable model. ESOP companies pay more, provide 2,2 times the retirement wealth, grow faster, and lay people off at one-third or less the rate of other companies. You can learn more about ESOPs at http://www.nceo.org. I hope this will be if interest.