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Article
Publication date: 16 November 2021

Jenny Weissbourd, Maureen Conway, Joyce Klein, Yoorie Chang, Douglas Kruse, Melissa Hoover, Todd Leverette, Julian McKinley and Zen Trenholm

The paper discusses the relationship between systemic inequity and wealth disparity and advocates for expanding employee share ownership as a strategy to address divides in income…

Abstract

Purpose

The paper discusses the relationship between systemic inequity and wealth disparity and advocates for expanding employee share ownership as a strategy to address divides in income and wealth by race and gender. It targets diverse actors including policymakers, philanthropic leaders and social investors and presents a set of policy proposals and practice ideas that seek to advance a broader understanding of employee share ownership and build the capacity of key organizations to support employee-owned businesses.

Design/methodology/approach

This paper draws on data indicating positive outcomes from employee share ownership programs (ESOPs) related to job quality, economic stability and wealth-building, as well as widespread political support for ESOPs.

Findings

This paper suggests that employee share ownership can help to strengthen job quality and address race and gender income and wealth gaps. It argues that there is both public support and a range of different strategies actors can implement to expand awareness and access to different forms of employee share ownership.

Research limitations/implications

Additional research focused on other forms of employee share ownership (beyond ESOPs) is needed to deepen understanding of how each form can play a role in addressing racial and gender wealth inequities. The paper acknowledges that despite the potential of employee share ownership to mitigate racial and gender wealth gaps, additional simultaneous strategies are required to address the range of systemic barriers that have disproportionately limited women and people of color's participation in ESOPs.

Practical implications

Policymakers are actively seeking new proposals, while philanthropic leaders, social investors and others are also eager to build awareness and understanding of employee ownership models and develop the institutional capacity necessary to support strong employee-owned businesses. This paper directly responds to these needs and contributes to a broader collaborative effort to spread employee share ownership policies and practices that support economic recovery and lay the foundation for a more equitable and resilient economy.

Social implications

Employee share ownership is not yet a strategy that is well understood among policymakers and the public, but it connects to and supports outcomes that are top of mind for many, including increasing local ownership and bolstering local economies, helping small business owners retire in ways that preserve local jobs and businesses, strengthening job quality and workforce development, addressing racial inequity and economic inequality and providing workers greater voice and agency. This paper seeks to connect employee ownership to these high-priority issues and support efforts by a range of organizations to implement policy and practice solutions.

Originality/value

This paper fulfills an identified need to aggregate recent research on the relationship between employee share ownership and wealth inequities on the basis of race and gender. It also offers a timely argument that employee ownership strategies can play an important role in responding to the challenges facing communities and workers – particularly women workers and workers of color – as we rebuild from the COVID-19 pandemic.

Details

Journal of Participation and Employee Ownership, vol. 4 no. 2
Type: Research Article
ISSN: 2514-7641

Keywords

Abstract

Details

Journal of Participation and Employee Ownership, vol. 4 no. 2
Type: Research Article
ISSN: 2514-7641

Article
Publication date: 7 August 2018

Joseph Blasi, Douglas Kruse and Richard B. Freeman

The purpose of this paper is to review the historical background for broad-based ownership in the USA, the development of forms of employee ownership and profit sharing in the…

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Abstract

Purpose

The purpose of this paper is to review the historical background for broad-based ownership in the USA, the development of forms of employee ownership and profit sharing in the USA, the research literature on employee ownership and profit sharing and related employee participation, the development of policy and options for new policies.

Design/methodology/approach

It is a literature review.

Findings

There are four reasons to be interested in employee stock ownership and profit sharing today: first, employee share ownership and profit sharing can increase worker pay and wealth and broaden the overall distribution of income and wealth, a key ingredient for a successful democracy. To be a tool for reducing inequality, employee stock ownership and profit sharing must be spread more widely and meaningfully than it is today. Second, employee share ownership and profit sharing provide incentives for more effort, cooperation, information sharing and innovation that can improve workplace performance and company productivity. Third, employee share ownership and profit sharing can save jobs by enhancing firm survival and employment stability, with wider economic benefits that come from decreasing unemployment. Fourth, employee share ownership and profit sharing can create more harmonious workplaces with greater corporate transparency and increased worker involvement in their work lives through access to information and participation in workplace decisions.

Research limitations/implications

Growth has been extraordinarily sluggish in the recovery from the Great Recession and has weakened in advanced countries over a longer period, leading some analysts to believe that the authors have entered a new economic era of small to modest growth. This may turn out to be true, which will increase the importance of growth-enhancing policies. The evidence that firms with employee stock ownership and/or profit-sharing perform better than others suggests that policies that extend ownership would boost the country’s lagging growth rate. The evidence that employee share ownership firms preserve jobs and survive recessions better than others suggests that policies that extend ownership could help stabilize the economy when the next recession comes down the pike.

Practical implications

Because there may be informational or institutional barriers about the benefits of ownership and sharing and the ways firms can introduce such programs that government can help overcome. Government has often played a role in promoting performance-enhancing work practices to enhance overall economy-wide outcomes from higher productivity and innovation, such as the long history of agricultural extension services (since 1887) to spread information on best practices in farming, and employer education on safety practices conducted by the Occupational Safety and Health Administration.

Social implications

Because of the “externalities” – effects that extend beyond the firm and its members – that greater ownership/profit sharing can bring us. If employee ownership and profit sharing lead to fewer layoffs and firm closures, this can reduce recession-created drops in consumer purchasing power and aggregate demand; government expenditures on unemployment compensation and other forms of support; decreased tax base for supporting schools and infrastructure; and potentially harmful social and personal effects, such as marital breakups and alcohol abuse. Apart from unemployment, more broadly shared prosperity and lower inequality may also have wider benefits for macroeconomic growth, stability and societal outcomes, as described by a number of social scientists. To the extent the ownership and profit sharing is a public good, a nudge in policy to consider the idea makes sense.

Originality/value

Because it is hard to find policy options that are as bipartisan as the shares policy. In The Citizens’ Share, and in other articles and venues, the authors lay out the areas in which there is evidence or logic for in-depth development of, and experimentation with, several broad policy directions, with the details to be worked out by members of Congress based on their deliberations.

Details

Journal of Participation and Employee Ownership, vol. 1 no. 1
Type: Research Article
ISSN: 2514-7641

Keywords

Abstract

Details

Journal of Participation and Employee Ownership, vol. 6 no. 3
Type: Research Article
ISSN: 2514-7641

Article
Publication date: 23 January 2024

Phela Townsend, Douglas Kruse and Joseph Blasi

This paper offers a new perspective on the potential motivation for the adoption of employee ownership based on market power. Employee ownership may be linked to market power…

Abstract

Purpose

This paper offers a new perspective on the potential motivation for the adoption of employee ownership based on market power. Employee ownership may be linked to market power, either through contributing to firm growth that leads to market power or through industry leaders adopting employee ownership as part of rent sharing or a broader consolidation of market position. Both employee stock ownership plan (ESOP) coverage and product market concentration (PMC) have been increasing in the past two decades, providing a good opportunity to see if and how these are related.

Design/methodology/approach

The authors predict ESOP adoption and termination using multilevel regressions based on 2002–2012 firm- and industry-level data from the Census Bureau, Compustat and Form 5500 pension datasets.

Findings

The authors find that the top four firms in concentrated industries are more likely to adopt Employee Stock Ownership Plans (ESOPs), while having an ESOP does not predict entering the top four, apart from firm-level predictors. Tests indicate the first result does not reflect simple rent sharing with employees but instead appears to reflect an effort by firms to consolidate market power through the attraction and retention (or “locking in”) of industry talent. Other positive predictors of ESOPs include company size, being in a high-wage industry and having a defined benefit (DB) pension.

Research limitations/implications

To better distinguish among hypotheses, it would be helpful to have firm-level data on managerial attitudes, strategies, networks and monopsony measures. Therefore, future research using such data would be highly useful and encouraged.

Practical implications

The paper includes implications for the potential usefulness of ESOPs in attracting and retaining talent and for the design of nuanced policy to encourage more broadly based sharing of economic rewards.

Originality/value

While prior research focuses on firm-level predictors of employee ownership, this study uses market concentration and other industry-level variables to predict the use of ESOPs. This study makes a unique contribution, broadening the current thinking on firm motives and environmental conditions predictive of firm ESOP adoption.

Details

Journal of Participation and Employee Ownership, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2514-7641

Keywords

Article
Publication date: 25 December 2023

Joseph Blasi, Adria Scharf and Douglas Kruse

This viewpoint will present some statistical information about employee ownership in the US and interpret and analyze this information in order to address the barriers question…

Abstract

Purpose

This viewpoint will present some statistical information about employee ownership in the US and interpret and analyze this information in order to address the barriers question using material from qualitative interviews that the authors have conducted over the last ten years with practitioners in the field. There have been few actual empirical studies that sort out the different barriers to employee ownership. The authors have chosen to focus on employee stock ownership plan (ESOP) in the US because this is the principal example from which people could learn from, and the high prevalence of ESOPs plays an important role in the US. This overview will present interpretations of these interviews with conceptual arguments that cannot always be supported with either overwhelming empirical studies or arguments that conclusively eliminate one or other explanation. This is an initial attempt to bring some comprehensive treatment and data to this incipient discussion. This is based on an interpretive analysis of qualitative interviews without quantification or social survey methods used for measurement. The advantage of this approach is that it lays out a completely different level of analysis of the barriers to employee ownership in the US that is “closer to the ground” and more based in the views of front-line practitioners who are actually implementing it.

Design/methodology/approach

Analysis and interpretation of qualitative interviews.

Findings

The list of barriers that has been identified is not exhaustive. The preliminary conclusions are that (not necessarily in this order) limitations of investment banking models, poor supportive infrastructure, complexity and cost and regulatory issues, the lack of support by political parties and social movements, the sale of companies due to financial considerations and legal complexities and lack of clarity and resistance by Federal agencies are major barriers in the US. Various sectors of Wall Street has been amenable to employee ownership with the proper government and private sector support. What is needed now is a series of quantitative surveys and qualitative interviews of retiring business owners in closely held companies and of CEOs and CFOs in stock market companies in order to gauge the barriers that they believe are blocking their own action in the employee share ownership area. The Rutgers Institute for the Study of Employee Ownership and Profit Sharing is working on such a research agenda at this time. In addition, with the future size of the US employee ownership sector at stake, a more intensive one-year interview project would make sense in order to present these different explanations to key actors and practitioners and ask them to provide evidence to prove or disprove the relevance of the different barriers.

Research limitations/implications

Empirical research which can resolve which barriers are more important than others is presented, when possible; however, studies that provide metrics to compare different barriers are not available and need to be carried out.

Practical implications

Other countries considering employee ownership policies can learn from the US experience. US policymakers and legislators can learn from an original, recent discussion of barriers.

Social implications

If employee ownership sectors are to be developed, a careful discussion of barriers is most relevant.

Originality/value

Original document by the authors based on original interviews.

Details

Journal of Participation and Employee Ownership, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2514-7641

Keywords

Content available
Article
Publication date: 5 December 2019

Joseph Blasi, Dan Weltmann and Douglas Kruse

Abstract

Details

Journal of Participation and Employee Ownership, vol. 2 no. 3
Type: Research Article
ISSN: 2514-7641

Article
Publication date: 3 September 2020

Mason Ameri, Terri Kurtzberg, Lisa Schur and Douglas Kruse

This purpose of this paper is to explore to efficacy of influence tactics at the outset of a job interview. Across three empirical studies, five influence tactics were manipulated…

Abstract

Purpose

This purpose of this paper is to explore to efficacy of influence tactics at the outset of a job interview. Across three empirical studies, five influence tactics were manipulated during a simulated job interview to explore first impressions for candidates with or without a visible disability.

Design/methodology/approach

Participants viewed videos of candidates (either in a wheelchair or not) responding to the opening question in a job interview by using one of five influence tactics (i.e. revealing a strong alternative, setting a numerical anchor, demonstrating approachability through imperfections, presenting hard skills that described job-related competencies or presenting soft skills including connecting well with and leading others). Perceptions of trustworthiness, fit for the current job and perceived appropriate salary amount were rated.

Findings

Results show that, in general, tactics that might have beneficial effects when used at later moments, including the use of a strong alternate, anchor or imperfection display, may instead harm first impressions of anyone. When discussing specific skills, hard skills helped in both cases. However, the presentation of soft skills helped only the non-disabled job candidate. Trustworthiness acted as a mediator for most of these relationships in both populations.

Originality/value

Results provide insight into how the use of these tactics very early in an interaction unfolds. Further, parsing the use of influence tactics into their effects on specific populations (such as people with disabilities) allows us to better understand the conditions under which they may help or hurt perceptions of employability.

Details

International Journal of Conflict Management, vol. 32 no. 2
Type: Research Article
ISSN: 1044-4068

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Abstract

Details

Journal of Participation and Employee Ownership, vol. 6 no. 2
Type: Research Article
ISSN: 2514-7641

Article
Publication date: 26 May 2023

Fitore Hyseni, Douglas Kruse, Lisa Schur and Peter Blanck

Many workers with disabilities face cultures of exclusion in the workplace, which can affect their participation in decisions, workplace engagement, job attitudes and performance…

Abstract

Purpose

Many workers with disabilities face cultures of exclusion in the workplace, which can affect their participation in decisions, workplace engagement, job attitudes and performance. The authors explore a key indicator of engagement—perceptions of organizational citizenship behavior (OCB)—as it relates to disability and other marginalized identities in the workplace.

Design/methodology/approach

Using an online survey, legal professionals answered questions about their workplace experiences. Ordinary least squares (OLS) multivariate regression analysis with progressive adjustment was used to investigate the effect of demographic and organizational factors on perceptions of OCB.

Findings

The authors find that employees with disabilities have lower perceptions of OCB, both before and after controlling for other personal and job variables. The disability gap is cut nearly in half, however, when controlling for workplace culture measures of co-worker support and the presence of an effective diversity, equity and inclusion (DEI) policy. Disability does not appear to interact with gender, race/ethnicity and LGBTQ + status in affecting perceptions of OCB.

Originality/value

The results point to the workplace barriers faced by people with disabilities that affect their perceptions of engagement, and the potential for supportive cultures to change these perceptions.

Details

Journal of Participation and Employee Ownership, vol. 6 no. 1
Type: Research Article
ISSN: 2514-7641

Keywords

1 – 10 of 127