What the evidence tells us

The shape and size of the employee owned sector is changing. Once reliant on a handful of large businesses, more recently there has been growth in employee ownership as a succession option for SMEs and family businesses.

As well as this, in the past two years, we have seen the transition of some larger privately owned businesses including Aardman Animations, Riverford Organics and Richer Sounds.

Evidence from the Ownership Dividend tells us that increasing the number of businesses that give employees a stake and a say will have benefits for the individual, businesses and deliver impacts of more resilient regional economies.

 

White Rose Centre for Employee Ownership survey

Data from the White Rose Centre for Employee Ownership survey shows there are 370 employee owned businesses in the UK with over 60% of conversions to employee ownership happening since 2014.

The sector experienced growth of 17.2% in 2017 and 18.5% in 2018.

The survey has also mapped the key sectors and regions for employee ownership:

  • Professional services (50% – of that 30% is from the professional, technical and scientific sector) manufacturing (17%), wholesale and retail (9.8%) health and social care (8.4%) and construction (6%).
  • London (25%) Scotland (16.5%) the South East (11.1%), East (7.9%), South West (7.6%) and Yorkshire and the Humber (7.6%)

Figures for the White Rose Centre for Employee Ownership survey are provided by Prof Andrew Robinson (University of Leeds) & Prof Andrew Pendleton (UNSW).

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The Top 50 Employee Owned Businesses (by size)

The Top 50 Employee Owned Businesses – the largest employee owned businesses in the UK – has recorded continued growth on a like for like basis (Like-for-like means each of the top 50 EOA companies has been compared against its own prior year results).

The Top 50 employee-owned companies have combined sales of £19.2bn (up 3.5% like for like) and over 166,000 combined employees (up 1.4% like-for-like) and wages up 2.5% (like for like)

Over the past six years the number of employees it takes to enter the top 50 has increased from 143 to 403. New entrants in 2019 are Richer Sounds in at number 44 and Bromley Healthcare CIC whilst the Top 50 has seen the departures of two of the larger businesses CH2m and AT Kearney

The mean increase productivity of the Top 50 is 6.2% in 2016, 7.6% in 2017, 9.7% in 2018 and 7.7% in 2019 which shows a set of businesses continuing to perform well, especially when compared to UK business as a whole.

The Top 50 Employee Owned Business measures the performance of the top end of the employee owned sector and is compiled by RM2.

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The Ownership Dividend 

In 2018 we published the Ownership Dividend: The case for Employee Ownership after a year-long inquiry into the employee ownership as an economic and social enabler.

The Ownership Dividend is the evidence report from a year-long, independent, business-led Inquiry. Read more about the inquiry

The report found that the Ownership Dividend can deliver a more productive and inclusive economy in three ways:

  • Improving UK productivity – via more businesses unlocking the enhanced performance and productivity powered by the increased personal endeavour and discretional efforts of employees acting with greater common purpose once they become employee owners.
  • Resilient regional economies – via a more sustainable and resilient business model that root jobs locally by providing an effective business succession solution, business independence and the ability to plan growth and investment over the longer term.
  • More engaged employees – via more inclusive, transparent and effective models of corporate governance and employee engagement which better involve, motivate and financially reward individuals through their ownership stake

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