Report finds employee owners far less impacted by COVID-19 economic downturn
With wealth inequality on a steady climb in the US, it will be little surprise to most that workers at employee-owned companies have suffered fewer of the negative economic impacts of the COVID-19 pandemic than the average American full-time employee.
You may, however, be shocked at just how dramatic the difference in outcomes has been.
According to a recent survey from John Zogby Strategies, employee owners are doing better all around than traditional employees during the pandemic:
They’ve experienced a much lower negative impact to household finances
They are far better equipped to handle a personal financial emergency
Only a small percentage are having their wages garnished
The survey also found that employee owners felt better about their financial futures than the average worker. They were half as likely to be concerned about paying down debts when forgiveness policies expired, and they were twice as likely to expect to retire before the age of 60. Less than half of employee owners reported worry about lack of sufficient retirement savings, while nearly two-thirds of traditional employees expressed some level of concern.
“We found a world of difference between the two groups by both subjective and objective measures,” the Zogby report states. “Policy-makers would be wise to incentivize the ESOP structure for as many working Americans as possible so that financial strength and independence may be fostered and achieved.”
Other key findings include:
Less than 5% of employee owners reported a job loss or downsizing, contrasted with 30% of non-ESOP employees
No surveyed employee owners were behind on rent or mortgage, while more than a quarter of non-ESOP employees struggled with housing costs
Employee owners were less likely to be using government payment protection benefits
Compared to the national average, employee owners were less likely to have experienced a reduction in benefits, including salary
VEOC Executive Director Matt Cropp explains:
“Research on employee ownership in previous economic downturns confirms the long-standing pattern of EO companies taking good care of their people. And those people respond with greater loyalty and productivity, leading to stronger and more prosperous communities in places where employee-ownership is widespread.”
Read the survey summary for more details. This is, of course, only one of the latest reports which have demonstrated the greater resilience and stability of workers at employee-owned companies.
