Americans have mixed feelings about gaining control of the companies they work for, a new Gallup survey has found.
Many want to own stock in their employer, and most trust they would be better stewards of their firm's long-term interests than are outside shareholders, according to the poll of 1,035 people conducted on behalf of the Employee Benefit Research Institute in Washington.
But although they want more of a voice in day-to-day matters, most of those questioned want to work in companies with clear distinctions between employees and management, and they want managers to make the important decisions.
The poll, taken in September for release today, affirms that some, but not all, of the advantages cited by backers of employee stock ownership plans, or ESOPs. Increasingly popular, ESOPs now give 10 million workers stakes in more than 9,600 companies, among them Avis, Weirton Steel, Polaroid and Hospital Corp. of America. In Southern California, companies with employee ownership plans are as varied as L & L Nursery Supply, a wholesaler in Chino, and Times Mirror, publisher of the Los Angeles Times.
One group of supporters--companies threatened by hostile takeovers--has used ESOPs to put stock into the hands of workers expected to be loyal to current management in any contest over their company's future. The poll confirms that expectation: 65% of respondents said they would not sell their stock to a hostile investor even if offered 50% more than the market value of their shares.
Other ESOP backers--advocates of workplace democracy--have contended that employees are more productive and companies less buffeted by pressure to perform in the short term when workers have a significant ownership stake in their firms.
Indeed, the poll found that 69% of respondents said they believed that employees would be more likely than outside stockholders to vote their shares in the long-term interest of a company.
But the results were hazier as to stock ownership's likely effects on workers' attitudes toward their jobs. A bare majority of those questioned, 51%, said stock ownership would increase their "commitment" to their work, though smaller percentages predicted a positive effect on their work quality, productivity or job satisfaction.
Experts on employee ownership say ESOPs have their greatest impact on the workplace in the roughly 40% of cases in which stock ownership is coupled with heightened worker involvement in decision-making. Studies have found that firms that pair stock ownership with employee involvement programs achieve annual growth rates 8% to 11% higher than those of firms where employees get stock but little else changes.
"Either one by itself, in theory, is supposed to produce that kind of result," said Martin A. Staubus, associate director of the ESOP Assn., a Washington trade group. "Yet, in practice, we just see very spotty results when only one approach is tried and a remarkably consistent result when they're coupled together."
The survey results indicate a real, but not universal, hunger for stock ownership. According to the poll, 44% of the respondents would trade their next pay increase for stock in the company they work for. But another 44% would not.
The decision was easier when those polled were ask to choose between stock that could be cashed out at retirement and employer-paid health insurance after retirement. A decisive 69% preferred the insurance.
Nor does it appear that ownership lessens American workers' historic reserve about controlling the destiny of their companies.
Most Americans, 56% in the poll, prefer to work for a company with a clear management hierarchy, rather than for a more level, democratic organization--though younger people, minorities and residents of Western states said they were more open to a less structured workplace.
And while 61% of those questioned felt strongly that companies fail to give workers enough say in decisions that affect them, large majorities want management to remain firmly in control. Of those polled, 72% said management alone should determine a company's long-term financial strategy, 71% said bosses should set hiring and firing policies, and 56% said managers should set rules for conduct at work.
"Employees really are not very interested in the overall policies of their companies as long as things are going reasonably well," said Corey Rosen, executive director of the National Center for Employee Ownership, a membership and research group in Oakland.
Employee stock ownership, Rosen said, is like citizenship: "You're glad you have the vote, but you don't really want to get involved in being a city councilman."
The error range in the poll was plus or minus 3.1%, according to the Employee Benefit Research Institute. Of those polled, 56% were employed full time and 17% worked for companies with employee stock ownership plans.
THE GROWTH OF ESOPS Cumulative number of employee stock ownership plans Cumulative number of employees covered by ESOPs, in millions
Source: National Center for Employee Ownership Inc., Oakland
EMPLOYEE OWNERSHIP IN SOUTHERN CALIFORNIA Companies at least 50% owned by their workers
Company Business, location Employees Science Applications Defense contractor, La Jolla 1,000 International Parsons Corp. Engineering, Pasadena 8,000 Treasure Chest Advertising Printing, Glendora 5,000 National Steel & Shipbuilding Shipyard, San Diego 3,100 Kilsby-Roberts Piping maker and distributor, 1,000 Brea Kirkhill Rubber Rubber products, Brea 1,000 Janco Electrical equipment 200 manufacturer, Brea Kirkhill Inc. Rubber products maker, Downey 200 L&L; Nursery Supply Wholesale nursery supplier, 174 Chino
Source: National Center for Employee Ownership