Job-creating performance of employee-owned firms, (EXCERPT), Monthly Labor Review Online, August 1983

Job-creating performance
of employee-owned firms

Corey Rosen and Katherine Klein

Contrary to popular belief, employee buyouts of troubled companies actually represent only a small percentage of all employee-owned companies—most employee ownership plans are set up in profitable ongoing companies. Further, employee-owned firms have an impressive record of job creation, with an average annual employment gain three times that of comparable conventional firms. Most of the plans provide for substantial employee control over company policy, giving employees full voting rights on their shares. The average employee-owned firm has 630 employees; all industries are represented, although there is some concentration in both durable and nondurable goods manufacturing.

These are conclusions from a recent survey conducted by the National Center for Employee Ownership. Although they are preliminary and must be regarded cautiously, they seem to support the contention that employee ownership can be a mechanism to improve business performance and economic equity.¹

This excerpt is from an article published in the August 1983 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.

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Footnotes

1 For detailed arguments for and against employee ownership, see Employee Ownership: a Handbook (Arlington, Va., National Center for Employee Ownership, 1982).

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