BURLINGTON — A speaker for a national group said Friday that Vermont businesses should consider selling to their employees as a way to help them build assets and reduce wealth inequality.
Marjorie Kelly, from the Democracy Collaborative, said businesses across the country whose owners are retiring have an opportunity to transition to employee ownership.
Kelly spoke at the annual Vermont Employee Ownership Conference at the University of Vermont in Burlington. The Democracy Collaborative is trying to spur 50 million employees across the country to take an ownership stake in the businesses they work for by 2050.
"It takes a job to get out of poverty; it takes assets to stay out of poverty," Kelly said in an interview. "Forty-six percent of Americans cannot pull together $400 in an emergency, and so when you begin to spread assets into hands of ordinary people, then you're starting to have a more stable economy."
"It's assets that enable you to weather unemployment or deal with an emergency or send a kid to college, or buy a home," she said. "And so employee ownership is a proven way to get assets into the hands of ordinary people, ordinary employees, including home care employees."
The Vermont Employee Ownership Center says 50 to 60 companies in the state are employee-owned. In 2016, there were a total of 21,192 companies in Vermont, according to the state Labor Department.
Companies like Carris Reels in Rutland, DuBois and King in Randolph, and King Arthur Flour in Norwich have been employee-owned for years. The founders of Switchback Brewing Co. in Burlington sold to their employees in February.
Kelly said there's an opportunity for many other local businesses to sell to employees. That's because of what she calls "the silver tsunami," the massive retirement of baby boomers. Some of those are entrepreneurs, she said, who need a way out of their business in order to retire.
Don Jamison, the executive director of the Vermont Employee Ownership Center, said there are two common types of employee ownership: a cooperative, in which workers have democratic control over their company and share in profits; and an employee stock ownership plan, or ESOP, in which employees own stock in their companies and can vote on the board of directors.
He said employee ownership can help a business owner find someone to buy the business, keep a company rooted in a community, and give employees more work satisfaction.
"Many people now, they don't have much wealth," Jamison said. "They only have wage income. So the aim is to increase the amount of people who actually have some wealth through shared ownership."
He said employees who have ownership stakes in their companies have higher incomes, better benefits and "much better retirement benefits" than employees at other types of companies.
At one of the conference's seminars, Adam Wrott, from the Valley Alliance of Worker Cooperatives, showed attendees a long list of the benefits that workers get at the Collective Copies Cooperative.
"To anyone else in the world, I would say, `Hey, can you show me another copy shop who does anything like this for their employees?'" Wrott said. "That's the power of the worker co-op."