November 9, 2016; Bangor Daily News
We need to develop new economic models to increase job creation and productivity. Instead of giving huge tax breaks to corporations which ship our jobs to China and other low-wage countries, we need to provide assistance to workers who want to purchase their own businesses…Study after study shows that when workers have an ownership stake in the businesses they work for, productivity goes up, absenteeism goes down and employees are much more satisfied with their jobs.
—Senator Bernie Sanders (I-VT)
In the spirit of carrying the best ideas of the presidential campaign forward, we want to remind you once again of the role nonprofits can play in remaking a healthier economy—specifically through embracing structures that allow workers not just to share in the profits, but to help shape the enterprise.
In Maine, where the workforce is older than the norm, the authors of a new report, “Cooperatives Build a Better Maine,” attest there are “roughly 32,000 small businesses with employees and they employ over half of our workforce. Research shows that 75–80 percent of these business owners will want to retire in the near future, but only 20 percent of them have a concrete succession plan.” This, they write, provides an opportunity to refit the state’s economy to reverse demographic declines and promote shared prosperity. They envision a state full of business clusters made up of enterprises of various types with no outside owners to extract value and run.
For those of our readers that might want to see this as a “cute,” crunchy granola–type endeavor, the authors have plenty of positive comparatives from which to draw a powerful argument. They write:
Compared to similar conventionally owned firms, employee-owned businesses create 2.5 percent more jobs, are one-third less likely to lay off workers in a downturn, and create 2.5 times the retirement savings for their worker-owners. Research shows they are also more productive and profitable. Today, the U.S. has over 7,000 employee owned firms with about 13.5 million worker-owners and $1.1 trillion in assets. In 2013, the most recent year for which figures are available, employee owned firms distributed $92 billion dollars in profits to their owners.”
The report presents a number of rich case studies to illustrate its points while acknowledging the barriers that remain present.
Readers will remember we covered a similar effort in Rochester last week. No doubt, it’s a different way of going about building an economy, but think about it! It would provide real distinction to the state of Maine, attracting new, younger residents with values that center around sustainability rather than exploitation and greed. That sounds worth a try.—Ruth McCambridge