Employees as Owners: A Labor Day Call to Action

This Labor Day, many Americans celebrate workers by firing up their grills and giving them a nod of appreciation. But one expert suggests doing more than just toasting, consider selling your company to its employees.

According to the author, who has 40 years of experience with Employee Stock Ownership Plans (ESOPs), employee ownership is a win-win-win situation. It benefits the owner by providing a fair market value for their business, allows employees to have a retirement account funded by the company's success, and keeps the jobs and local roots intact.

The math on who owns America is concerning, with the bottom half of households holding only 1% of the country's equities. Since 1980, the S&P 500 has climbed by around 20,000%, far outperforming wage or home value growth. However, ESOP companies make up less than 1% of American companies, and the number of new ESOPs formed each year is roughly equal to those that wind down.

The author emphasizes that an ESOP is not suitable for every company but believes it deserves more consideration. They point out that partial ESOPs could open doors to more businesses and employees, citing the growth of the Expanding ESOPs coalition, which now has over 100 members.