End of Year Review 2015: Worker co-ops

Britain’s employee ownership sector grew faster than the economy as a whole, and worker co-ops collaborated to develop the Worker Co-op Solidarity Fund and promote worker co-ops among young people. But employee-owned paper and printing firms Tullis Russell and Watford Printers both closed due to unfavourable economic conditions.

The British employee-owned sector is now worth £30bn annually, with the number of businesses increasing by almost 10% per year. Britain’s top 50 employee-owned firms are worth £21.5bn. Figures released for Employee Ownership Day, on July 3, showed the sector grew 4.6% year-on-year, while last year the UK economy grew by 2.8%.

The combined workforce of the top 50 businesses tops 164,000 – an increase of 4.3%. Five of the UK’s 100 largest private companies are employee-owned. One in seven people in those top 100 companies is an employee owner.

The John Lewis Partnership topped the annual review of UK-registered companies more than 25% owned by employees, which is produced by RM2 Partnership with the Employee Ownership Association (EOA). Other big players include engineering consultancy Mott MacDonald, design consultants Arup Group and engineers CH2M Hill Europe.

This year the EOA launched a new award for businesses considering employee ownership. Sponsored by the John Lewis Partnership, the EOA Investment Award offers £10,000 towards professional fees to build employee ownership structure.

Dowding Precision was the first winner. Sir Charlie Mayfield, chairman of John Lewis said: “Dowding Precision are a fantastic example of a small, high-tech, high-skill, family-run business, manufacturing everything from parts for Formula 1 cars to surgical instruments… The kinds of companies most suited to employee ownership are often SMEs that are knowledge-intensive.”

Ikea launched a new range of products created by women’s worker co-ops in rural India, in partnership with social enterprises Rangsutra and Industree PT.

But it was not all good news. May saw the demise of both paper manufacturer Tullis Russell and printing firm Watford Printers, both of which had to contend with difficult trading conditions.

Tullis Russell closed with the loss of almost all 475 of its jobs. “International pressures have caused the closure of pretty well the whole UK printing paper manufacturing industry,” said David Erdal, who led the transfer from his family to employee ownership and is now a writer and researcher on employee ownership. “No ownership system can save a business undermined by global competition from better-placed competitors.”

Watford Printers, the last of the worker co-partnership societies and Britain’s oldest worker-owned co-op, merged with local private firm Hill & Garwood in May.

In another example of collaboration between worker co-ops, young co-operators have been working together to develop a national network which will promote co-operation to young entrepreneurs.

The network emerged from AltGen and Co-operatives UK’s the Young Co-operators Prize, which was awarded in April to workers co-ops Blake House film co-op, Chapel Street Studio, Founders and Coders, London Student, Ceramics Co-op. In November the five winners held a weekend to discuss how they could support, educate and trade with each other and take the message of worker co-operation to other young businesses.

Rhiannon Colvin of AltGen said the aim was to take the co-operative movement to the young, dynamic entrepreneurs out there with workshops, events and resources tailored to what stage the co-operative is on its journey. “We’re here to inspire, facilitate and support,” she said.

Key events:

FEB: Co-op Party election manifesto includes push for worker co-ops

APR: Five Young Co-operators Prize winners announced

MAY: New Employee Ownership Association award will support worker buyouts

JUL: Employee ownership growth outpaces UK economy

SEP: Worker Co-op Solidarity Fund to hold strategy meeting

OCT: Beanies Wholefoods, Sheffield, voted Best Independent Retailer in Observer Food Monthly Awards

NOV: Young co-operators meet to develop network

Highlights:

Britta Werner

Worker member at Unicorn Grocery

My highlight last year was the even better worker co-op weekend. And in general there is now a much better network of worker co-operatives. A worker co-op HR event, loads of great training courses organised by Co-operatives UK and a congress that includes worker coops and helps to bring great proposals to light.

The worker co-op solidarity fund is another great thing that has grown. With so many things people doing so much stuff in their own time, the work on governance and how it is all going to work in practice, should be a focus next year, maybe using some of the fund to help getting people together to work on it.