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According to this article, from 2000 to 2012 productivity went up about 25%, but wages increased only about 7%. Where is the wealth going? Most US citizens do not realize that most federal tax incentives for employee stock ownership and profit sharing — billions and billions over decades — go to subsidizing shares for the top five executives of stock market companies.

This article argues that US federal and state governments should update and meaningfully expand the tax incentives for every business in the country to seriously consider offering lower risk broad-based cash or deferred profit sharing plans, employee stock ownership plans such as an ESOP, grants of restricted stock, or a stock option plan to all of their workers.

Read the article here.

Take away:

  • Fairly structured ESOP’s may be a mechanism for promoting employee engagement and improved financial stability of the middle class.

 

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