What you should know about ESOPs in construction
Many companies in the construction industry are owned by a select few or a single family. While this is a long-standing tradition, there’s another method that increases employee performance and satisfaction: Employee Stock Ownership Plans (ESOPs) in construction.
If you’re interested in learning more about ESOPs and how they work, we’ve created a short guide on the basics you should know.
What is an ESOP?
An ESOP is an employee ownership structure that works similarly to a 401k, meaning it is a qualified retirement plan. Employees are given ownership over the company’s stock and more shares continue to be distributed to employees over time. If you work for an employee-owned company with an ESOP, you have your own account that holds your shares in the company. Becoming fully vested (gaining full ownership of your shares) typically takes a few years, which can encourage employees to stay at employee-owned companies for the long-term.
Benefits of ESOPs in construction
Since employees become owners, they have a stake in what happens to a company. As a result, they become actively involved in making the company the best it can be. This may be in the form of building better client relationships, providing the best tools for construction, brainstorming innovative ideas and more.
Oftentimes, employee-owned companies find increased longevity with their employees and the business as a whole. Employees are more likely to stay with a company because they hold an important role as a part owner through the ESOP. The ESOP organizational structure empowers employees to perform at their highest potential, because when the company performs better, share values increase and all of the employee shareholders personally benefit as well.
In regards to the company, employee-owned businesses typically fare better in economic crises like recessions. For example, a study from the 2008 U.S. recession found that employee-owned companies outperformed their counterparts; they were even hiring new employees while other companies were forced to let employees go.
Learn more about ESOPs in construction with McCownGordon
At McCownGordon, our team of builders and engineers maintain a customer-focused mentality, allowing us to outperform even your highest expectations. Dedicated to promoting integrity, performance and relationships, it’s our people and values that truly make the difference.
Our customers aren’t simply another project; they’re an extension of our team and community. Together, we don’t just build—we bring creative visions to life. From first thought to final nail, we deliver quality work to ensure our builds stand above the rest.
We have three regional offices around the Midwest—Kansas City, Manhattan and Wichita. Call us at 888-304-4929 or use our free online quote tool to start building today.