Employee ownership and the firms that choose it
Profit sharing and employee ownership appear on 24 recent papers spread thinly across the tracked journals. As founders of the baby-boom generation retire, employee buyouts and ownership trusts are one way to pass on firms. Do employee-owned firms survive longer, pay better, and invest differently?
What prompted this
Since October 2025, 24 papers carry an employee-ownership, profit-sharing, ESOP or worker-cooperative keyword, spread across economics (6), finance (6), operations research (4), accounting (3), management (3) and AI (2): "profit sharing" on 11, "employee ownership" on 10, "worker cooperatives" on 1.
Questions
- When a retiring founder sells to employees rather than to a competitor or a fund, does the firm keep more jobs and plants in place over the next decade?
- Do employee-owned firms pay more, invest less, or take fewer risks, and do their workers hold too much of their wealth in one firm?
- Do the tax incentives for employee ownership trusts, as in the UK and proposed elsewhere, raise the number of such sales?
Data that could help
Ownership transition records, employee ownership registers, firm accounts (Orbis) and employment data.
Next step
Compare survival, employment and wages of UK firms sold to employee ownership trusts since 2014 with firms of similar size sold to trade buyers.