🗞️ Worker-Owners on the Rise: DOL Reports Decade of Growth in Employee Ownership

On February 23, 2026, the U.S. Department of Labor's Employee Benefits Security Administration (EBSA) released a report to Congress on the state of employee ownership in the United States and the status of its statutory initiative to promote it. The report fulfills a reporting requirement under Section 346 of the SECURE 2.0 Act of 2022, whose Worker Ownership, Readiness, and Knowledge (WORK) provisions directed DOL to establish an Employee Ownership Initiative and submit to Congress both a progress report on employee ownership and an analysis of the costs and benefits of the Department's related activities.

The report tracks three primary employee ownership models over roughly the past decade. Employee Stock Ownership Plans (ESOPs), the most prevalent form, covered more than 15 million participants across 6,525 plans as of 2023, with total assets reaching an estimated $2.0 trillion—a 57% increase since 2014. Total ESOP participants grew 8% over that period, driven largely by leveraged stand-alone ESOPs, which saw plan counts rise 28%, participants rise 39%, and assets surge 184%. Worker cooperatives more than doubled in number, from 323 known firms in 2014 to 820 in 2024, according to biennial surveys by the U.S. Federation of Worker Cooperatives and Democracy at Work Institute. Employee Ownership Trusts (EOTs), a newer model with the first U.S. example established in 2014, are forming at increasing rates, with approximately 32 employer businesses now substantially EOT-owned as of the report's publication.

A notable structural trend across all three models is the increasing use of employee ownership as a business succession strategy. The report connects this trend to the ongoing wave of baby boomer retirements, noting that advocates describe the demographic moment as an opportunity to transition longstanding private companies to employee ownership, thereby preserving both businesses and jobs.

EBSA established a Division of Employee Ownership (DEO) in June 2023 to implement the initiative. The division's first Chief, Hilary Abell, began her role on June 30, 2024. The WORK Act authorized $50 million in grants to state employee ownership programs, as well as funding for administration and initiative development; Congress has not appropriated any funds for these purposes. As a result, DEO operates with a single full-time staff member, funded through EBSA's existing budget. Activities to date have included approximately 100 stakeholder meetings, conference presentations, publication of educational materials, and the January 2026 expansion of the initiative's public website.

As of December 2025, nine states have state-funded employee ownership programs—called State Employee Ownership Programs (SEOPs) in the report—in California, Colorado, Iowa, Massachusetts, Michigan, New Jersey, Ohio, Vermont, and Washington. Five of these launched in the 2020s. The report notes that Washington's program funding was cut during a 2025 state budget crisis, though the program remains authorized in statute. Colorado, Iowa, Michigan, and New Jersey offer direct financial assistance for employee ownership transitions through tax credits, grants, or reimbursements. Roughly half of all states have at least one nonprofit center focused on employee ownership, though most lack state funding and are therefore not classified as SEOPs.

The report outlines future work subject to available resources, including supporting a grant program for states, expanding the clearinghouse website, and building out DEO staffing. DOL Secretary Lori Chavez-DeRemer delivered a keynote at the ESOP Association's annual conference in May 2025.

Key Points

• ESOP participants grew 8% over 10 years to 15.1 million; total ESOP assets grew 57% to $2.0 trillion as of 2023.
• Leveraged stand-alone ESOPs—those using borrowed funds to purchase employer stock—were the fastest-growing ESOP segment, with assets up 184% since 2014.
• Known worker cooperatives more than doubled from 323 (2014) to 820 (2024); EOTs are a small but growing model, with approximately 32 U.S. businesses now substantially EOT-owned.
• Employee ownership as a business exit and succession strategy is increasing across all models, tied in part to the ongoing wave of baby boomer retirements.
• Congress authorized $50 million in grants to state employee ownership programs under SECURE 2.0 but has not appropriated any funds; DEO operates with one full-time staff member funded through EBSA's existing budget.
• Nine states have state-funded employee ownership programs as of December 2025; Washington's program remains in statute but lost funding during a 2025 state budget crisis.
• Colorado, Iowa, Michigan, and New Jersey provide direct financial assistance—tax credits, grants, or reimbursements—for employee ownership transitions.
• The report marks the first time a federal agency has compiled this type of comprehensive public resource on employee ownership and state programs, according to EBSA.

Primary Source Author: Employee Benefits Security Administration (EBSA), U.S. Department of Labor

Primary Source: Employee Ownership Initiative Report to Congress (February 2026)

Primary Source Link: https://beta.dol.gov/research-data/report/employee-ownership-initiative-report-congress

Supplemental Resources

• DOL Press Release – Release No. 26-182-NAT (February 23, 2026)
• EBSA Employee Ownership Initiative Website
• SECURE 2.0 Act of 2022 – Full Text (Congress.gov)
• EBSA Form 5500 Private Pension Plan Bulletins
• National Center for Employee Ownership (NCEO)
• U.S. Federation of Worker Cooperatives
• Colorado Employee Ownership Office
• Ohio Employee Ownership Center – Kent State University
• Employee Ownership Expansion Network – State Centers
• Broughton et al. – EOTs and Perpetual Purpose Trusts in the U.S. (Harvard Dataverse)