January 22, 2016

Worker cooperative update

Next City - Worker cooperatives can sometimes sound too good to be true: a business owned and controlled by its workers, who each usually get an equal share of the profits. Compensation for some has gone from $6.25 an hour to $25 an hour. Flexible schedules. Worker majorities on the boards of directors interviewing CEO candidates. Dignity at work and wealth at home for some of the most marginalized — a group of Filipina women, many of them survivors of human trafficking, launched a cleaning worker cooperative in New York City last September.

For many reasons, worker cooperatives have had difficulty growing in number and size. Comprehensive data on worker cooperatives are hard to find, but the U.S. Federation of Worker Cooperatives (currently estimates there are around 350 in the U.S., employing about 5,000 people. That’s an average co-op size of 15 or so. They do seem to get a good amount of business, cumulatively earning around $500 million in annual revenues.

Seeing the promise of the worker cooperative model to address inequality of income and opportunity, the city of New York announced a $1.2 million Worker Cooperative Business Development Initiative over a year ago — and initial results from that effort are in.

According to the new report, during the first year of the initiative, the city and its partners have supported the creation of 21 new worker cooperatives. That alone nearly doubles the number of worker cooperatives in NYC, not counting any that may have gotten started without the city’s support. Just 23 worker cooperatives existed in New York City as of January 2014.

The report finds that six of the new worker cooperatives got started with support from Green Worker Cooperatives, an organization dedicated to incubating worker-owned green businesses. They’re located in the South Bronx, for many years the nation’s poorest congressional district, and also home to Cooperative Home Care Associates, the nation’s largest cooperative, with more than 2,000 members.

The WCBDI also reported providing 84 services to 24 existing worker cooperatives.

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