By Margaret Miley, Cooperative Business Director
Sometimes we circle back in our work; revisiting previous efforts with new tools, fresh eyes, and renewed conviction. In my personal mission to help make our economy more accessible, sustainable, and equitable—I’m circling back to worker ownership as an enduring and now reawakening model of economic strength. It began on the phone with my son, finishing college and refining his resume. He called after reading mine.
HIM: Mom, you started a worker co-op in Lowell in the 1990s? That’s so cool! I never knew that… why didn’t you tell me?
ME: Uh yes, but you were 2 years old. Most of our discussion at the time focused on you not trashing my office…
HIM: Oh yeah. But that’s really cool, Mom!
After I recovered from hearing a son saying his mother might have been cool, I began to look again at worker ownership. Were co-ops cool again?
Co-ops, encompassing employee, consumer, and tenant ownership have a long history in dozens of countries, including the US, particularly in the food production and financial services sectors. Many consumers don’t realize they are supporting locally controlled co-ops when getting lobsters from Maine, cranberries from Cape Cod, or mortgages from credit unions. In the 1990s, co-ops were adapted and presented as a community development option in the “relatively rare” instances when markets didn’t work properly; such as when housing prices surpassed local wage capacity or investment capital was inaccessible for local business startup or expansion.
The home healthcare cooperative we launched in 1996, Valley Homecare, hired and retrained certified nurses’ aides from a rapidly concentrating for-profit nursing home industry to provide high quality homecare to elders hoping to remain in their homes. Cuts in Medicare in the mid-1990s resulted in the destabilization of the entire industry nationwide, and millions of fragile elders had to resort to moving to long term facilities. We sadly closed the 25-person business and I moved on to more focused economic approaches, including “asset-building” which has an individualist framing of financial access, skills, and incentives. Co-ops seemed to fade from the community development conversation.
Since then, there has been increasing recognition that markets often don’t respond to the benevolent “invisible hand” described by Adam Smith. Indeed the hypermobility of capital and resulting public incentives have accelerated the concentration of distant ownership in dozens of industries, offshoring of jobs, and housing displacement of multigenerational communities, both urban and rural. Individual asset-building, worker training, and similar efforts usually don’t address the systems change needed to reverse the runaway inequality crisis.
A new generation is looking for solutions, and co-ops have compelling data on stability, morale, productivity, sustainability, and local multiplier effects. Their commitment to democratic management practices correspond to our cultural awakening and increased respect for collaborative and diverse workplaces.
As consumer and worker perspectives and tastes change, communities, economic developers and public officials are turning their attention to forming and supporting locally owned cooperatives and converting businesses to employee ownership. Incentives, investment capital, training, and other resources have been flowing into this renewal. Community groups, retiring business owners, public agencies, and investors are working quickly to transition, innovate, cross-pollinate, and expand the model to expand cooperative ownership.
The Northeast has been a regional leader with the Cooperative Development Institute (CDI) participating in much of the effort, working with local organizations and lenders to convert thousands of housing units to cooperative communities for families throughout New England. Worker and consumer co-ops have been launched as start-ups and mature businesses have been converted to employee ownership as CEOs and founding entrepreneurs retire. These co-ops are redeveloping and rejuvenating rural towns and small cities throughout New England, particularly in Maine. Supporting CDI’s efforts are national partners such as the Democracy at Work Institute, ROC USA, and Business Alliance for Local Living Economies, and our regional partner, the Cooperative Fund of New England.
I’m excited to join CDI as Cooperative Business Director, having spent much of my working life at the nexus of entrepreneurship, economic justice, and network-building. I’m inspired by the brilliance and energy of my colleagues in running one of the highest functioning nonprofits I’ve seen in years.
This is clearly a transformational national movement, and co-ops are having a moment. With state legislatures and presidential candidates including them in bills and policy agendas, the prospects for growth are increasing. Even economists, often no more perceptive of early trends than a 2-year-old rummaging through my office, are catching on.
There’s no doubt; co-ops are cool.
Margaret Miley has a Bachelors in Economics, a Masters in Business & Community Economic Development, and has served as a nonprofit economic development director and a CEO of small businesses, worker cooperatives, and The Midas Collaborative in Massachusetts.