Staff at Softstar Shoes in Oregon have discovered a fresh enthusiasm for conserving assets and increasing earnings.
This began in January when the footwear company came under the ownership of its 30-person team.
Former sole proprietor and chief executive Tricia Salcido had chosen to sell the enterprise to the workers, as at age 56 she is starting to prepare for her eventual retirement.
Salcido, who is staying on as chief financial officer for the next few years, notes that colleagues are now providing numerous recommendations on how to manage various aspects of the business.
"I'm receiving personal emails from employees saying, 'well, have you considered this idea?'" she says. "These are business insights that weren't offered before!"
Salcido is part of a small but expanding group of business owners in the US who are reportedly opting to entrust their enterprises to employees, rather than selling to an external buyer.
A 2025 study indicated that up to 600 US firms are now being transferred to their workers each year, with investment funds available to assist in financing the deals rising 78% to $865m last year from $500m in 2024, a sign of more businesses undergoing this transition.
Beyond motivating staff β who share in the risks and rewards of ownership β research shows that employee-owned companies can be more efficient, less prone to layoffs, and tend to offer higher wages.
For Salcido, it was a way to safeguard local jobs and prevent her firm's artisanal shoemaking from being moved outside the US β something she was certain would happen under a cost-cutting corporate acquirer.
"It's something you dedicate your life's work to⦠most small business owners truly care," she says.
A vast number of other US entrepreneurs are in a similar position to Salcido β they are nearing retirement age and thus must decide what to do with their businesses.
The "baby boomer" owners of approximately six million American small and medium-sized companies will retire between now and 2035, according to a report this year from business consulting firm McKinsey. Some commentators have labeled this a "silver tsunami."
McKinsey adds that this mass retirement will lead to "a once-in-a-generation wave of ownership transitions."
Ethan Rouen, associate professor at Harvard Business School, says: "I don't think a week goes by where I don't speak with an owner who is looking to sell their business." Their adult children often have no interest in taking over the family venture, he adds.
Rouen and his Harvard colleagues believe that a shift to employee ownership could help many firms survive, and that such a move often appeals to owners who deeply care about their employees and worry about what would happen after a sale to a larger company or private equity firm.
That was the case for William Stockwell, who wanted to secure the future of Stockwell Elastomerics, the Philadelphia-based manufacturer of industrial components that his great-grandfather started in 1919.
Stockwell decided to sell to his employees after witnessing what happened to other firms that had been acquired. "The new [outside] ownership might relocate the business, they might shut it down, or drastically alter it in other ways, and the people remaining are left stranded," he says.
There are several different structures available in the US through which a workforce can purchase their company. At Softstar Shoes they used an Employee Ownership Trust (EOT).
Under an EOT, a trust is established, which takes ownership of the business on behalf of the staff, eliminating the need for them to buy the business with their own funds.
The trust then pays the former owner the agreed sale price of the business in installments as a share of future profits.
This means that Salcido has committed herself to a waiting period before she receives her money, with an added element of risk β she needs the business to continue to perform well.
"I bear the risk, in that if anything happens, I don't get paid," she says. But she has confidence in her team to deliver. They also receive a portion of annual profits.
Stockwell, who now works part-time for Stockwell Elastomerics, chose a slightly different method of transferring ownership to the staff β an Employee Stock Ownership Plan or ESOP.
This also places the business under trust ownership, but instead of staff sharing the annual profits, they receive shares that they can only cash in when they leave the company.
Meanwhile, the retiring owner also must wait for their money. "I'm accepting payments over 10 years," says Stockwell, who acknowledges he is making a "short-term financial sacrifice."
ESOPs are the most common method by which firms are transferred to their workers in the US. In 2023, the most recent year for which data is available, there were 6,609 companies under such ownership structure. These employed 10.9 million people and held combined assets of more than $2tn (Β£1.5tn).
A third method of staff taking ownership is through the creation of a worker co-operative, whereby workers purchase a share of the business.
Harvard's Rouen says employee ownership doesn't only appeal to older founders looking to preserve what they have built over many years. Younger workers, "disillusioned" by traditional, unequal corporate structures, are also drawn to the model.
"The only way to truly create wealth in this country is through ownership of capital. And this is a way to democratise that," he says.
However, EOT and ESOP schemes are undoubtedly more complex to set up than a straightforward, traditional sale of the business, which may deter some owners. As does the longer wait for their money, and the increased risk.
Adoption is also hindered by a lack of awareness that the schemes even exist. "No one's heard of them," says Salcido at Softstar Shoes.
In central Pennsylvania, Paul Silvis is in the process of selling his manufacturing business SilkoTek Corporation to his employees. He says he is confident that he has made the right choice.
"I'm getting ready to ride off into the sunset at some point," says the 71-year-old.
Stockwell warns that retiring business owners who want their staff to take over ownership need to start planning early for a process that could take years. "It's not something you want to begin the year you intend to retire," he says.
Rouen says that, fortunately, there is now political will in Washington to simplify the process of employee ownership, as the US government has started to encourage it. The Department of Labour has a new Employee Ownership Initiative, which aims to both promote the practice and provide guidance.
He adds that there is also bipartisan support in Congress "to figure out ways to make [selling up to staff] an easier and more realistic option for business owners." As a result, "my hunch is that we will see more successful employee ownership conversions in the next few years."