Are there more union members or employee owners in the US?
Are there more union members or employee owners in the US?
It's complicated.
TLDR: There are probably 14.3 million union members out there. There might also be as many as 17 million Americans with some kind of ownership where they work. But the number of employees with a stake in a company meaningfully described as employee owned is probably more like 3 million.
Background: Unions are all over the news this week. The Writers Guild of America just got a big win in their negotiations with studios, Joe Biden became the first President to join a picket line, and Donald Trump is skipping the second Republican “presidential” debate to speak with union members.
But those wins come at a time when union membership has continued its decades-long decline. Those most recent numbers suggest that 14.3 million Americans are union members, or just over 1 out of every 10 wage and salary workers.
On a phone call this week, a colleague of mine raised the question: how does the number of employee owners compare to the number of union members in the US?
So how many employee owners are there? The National Center for Employee Ownership says there are 13.9 million ESOP participants, and 10.1 million active ones. At a recent Aspen Institute event, Joseph Blasi used the lower of those two numbers:
Employee ownership has a long and important tradition in the US. Today, approximately 18% of employees have some form of ownership stake in the company where they work. Employees participating in ownership in the US do so through a variety of means, including employee stock ownership plans (ESOPs), equity compensation programs, worker-owned cooperatives, and employee owned trusts (EOTs). About 10.1 million employees participate in ESOPs, and an estimated 11.8 million employees participate in different combinations of equity compensation plans, including grants of restricted stock, stock options, and employee stock purchase plans.
Estimates show that approximately 10,000 workers are employed in between 900 and 1,000 worker-owned cooperatives, and an estimated 13,000-60,000 employees are employed by 31 EOTs [citation: EO+WD!].
On top of that, just shy of 6,000 workers are members of worker cooperatives, according to a 2021 study.
What do we mean by “employee owners?” Those top line numbers are pretty big; 11.8 million versus 14.3 million is what my Louisiana family might call “spitting distance,” and if we go with the NCEO’s larger number, then we’re only a couple more years of sliding union membership away from being on par. But we should probably break those numbers down a little more. Two efforts at that:
Over at FiftyByFifty, which aims to grow the number of employee owners to 50 million by 2050, Michael Keeling throws out an even larger number—17 million!—but suggests that the number we should be focusing on is the 4 million Americans who work for and own a stake in privately held companies. In most of those, he says, employees own most of the company.
Part of Certified EO’s standard for calling a company employee owned is that employees own over 30% of the company. By that standard, there are 2-3 million employee owners in the US.
More threads to pull: I don’t know much yet about the relative benefits to workers of union membership versus different kinds of employee ownership. This 2015 report from Project Equity touches on the relationship between unions and worker cooperatives, and lawyer Deborah Olson’s website has a raft of case studies on unions + ESOPs and unions + worker cooperatives.
I also don’t know much about how union membership and employee ownership interact with each other—do they reinforce or undercut each other’s benefits to workers? This 1995 paper by Andrew Pendleton and Andrew Robinson is where I would start: Does employee ownership weaken trade unions? Recent evidence from the UK bus industry. A couple of interesting citations and relevant papers there:
Unions and employee ownership: A road to economic democracy? (2006)
Employee stock ownership plans: Union influence and stakeholder interests (1999)
Employee ownership, participation and governance: a study of ESOPs in the UK (2002)
A new frontier for labor: Collective action by worker owners (2008)
You might notice that all of those papers are from before 2010—and most of them were written in the 1900s, as my students would say. The more recent articles that pop up when I’m trolling Google Scholar, by contrast, seem to use declining union membership as a rhetorical jumping-off point for discussing the role of employee ownership in promoting worker participation and voice.
Thanks for reading this far! That’s my best 60-minute shot at this. What am I missing?