Detroit City Wire

The Michigan Department of Labor and Economic Opportunity (LEO) has partnered with the Michigan Center for Employee Ownership (MICEO) to launch a $500,000 pilot program. This initiative aims to expand access to employee ownership among businesses and workers in Michigan. The program is timely, as many business owners are approaching retirement without clear succession plans.

Lt. Governor Garlin Gilchrist II emphasized the benefits of employee ownership, stating, “Employee ownership is a powerful tool for preserving local businesses, empowering workers and building a more resilient economy.” He added that this investment will help retain jobs within Michigan communities and provide workers with stakes in the businesses they contribute to daily.

Employee ownership involves giving workers an ownership stake in their companies through stock or equity. It not only secures business legacies but also creates wealth-building pathways and job security for employees. Nationwide data shows that 75% of business owners plan to exit within the next decade, yet only 34% have documented succession plans.

Susan Corbin, LEO Director, noted that investing in employee ownership contributes to long-term success for Michigan’s economy by empowering individuals and enhancing business performance. The Transition to Employee Ownership Pilot Program offers resources for businesses considering transitioning to employee-owned models.

Roy Messing, Executive Director for MICEO, explained that the program would raise awareness about employee ownership transitions and provide qualifying businesses with necessary resources. MICEO will administer the program, focusing on marketing and statewide outreach while providing financial evaluations, legal services, and technical assistance.

Sean Egan, LEO’s Deputy Director of Labor, highlighted the importance of keeping long-standing businesses operational within their communities through these transitions. Baby boomers own approximately half of all Michigan businesses.

Employee-owned firms report higher performance metrics such as increased sales and productivity. Employees in these firms earn 33% more in wages and receive better benefits compared to peers in non-employee-owned companies.

The Small Business Association of Michigan (SBAM) supports this initiative as it addresses succession challenges faced by small businesses today. Brian Calley, President & CEO of SBAM stated that locally owned businesses create significant value both economically and socially within their communities.

With federal support from initiatives like the WORK Act and SSBCI promoting employee ownership provisions, Michigan’s pilot program aligns with national priorities.

To explore more about employee ownership opportunities in Michigan, interested parties can visit the MICEO website.