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Worker Participation

Worker Participation: Lessons from Worker Co-ops of the Pacific Northwest

John Pencavel
Copyright Date: 2001
Published by: Russell Sage Foundation
Pages: 128
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  • Book Info
    Worker Participation
    Book Description:

    Once they accept a job, most Americans have little control over their work environments. InWorker Participation, John Pencavel examines some of those rare workplaces where employees both own and manage the companies they work for: the plywood cooperatives and forest worker cooperatives of the Pacific Northwest. Rather than relying on abstract theories, Pencavel reviews the actual experiences of these two groups of worker co-ops. He focuses on how worker-owned companies perform when compared to more traditional firms and whether companies operate more efficiently when workers determine how they are run. He also looks at the long-term viability of these enterprises and why they are so unusual.

    Most businesses are constantly caught in the battle over whether to use the firm's profits to pay labor or to increase capital. Worker cooperatives provide an appealing case study because the interests of labor and capital are aligned. If individuals have a role in setting goals, they should have an added incentive to help meet those goals, and productivity should benefit. On the other hand, observers have long argued that, since any single employee in a co-op reaps only a small benefit from working hard, workers may shirk work, and productivity can flag. Furthermore, co-ops often have difficulty raising capital, since they are constrained by how much money the workers have, and banks are often reluctant to lend them money.

    Using some fifteen years of data on forty mills in Washington State, Pencavel examines how worker co-ops really function. He assesses the practical problems of running a workplace where every employee is a boss. He looks at worker productivity, on-the-job injuries and financial risks facing owner-workers. He considers whether co-ops are inherently unstable and if they are plagued by infighting among the many worker-owners.

    Although many of the co-ops he studied have closed or been replaced by conventional businesses, Pencavel judges them to have been a success. Despite the risks inherent in such operations, allowing workers to make the decisions that profoundly affect them produces many benefits, including workplace efficiency and increased job security. However, Pencavel concludes, if more Americans are to enjoy such a working arrangement, labor laws will have to be changed, participation encouraged, and a more vigorous public debate about worker participation must take place. This book provides an excellent place to start the discussion.

    eISBN: 978-1-61044-443-9
    Subjects: Business, Management & Organizational Behavior, Sociology

Table of Contents

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  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-vi)
  3. About the Author
    (pp. vii-viii)
  4. Preface
    (pp. ix-x)
  5. 1 Introduction: Citizens, Consumers, and Workers
    (pp. 1-19)

    The right of adults to select their representatives in the political process is widely regarded as a fundamental aspect of American democracy. The system is imperfect: some individuals choose not to exercise that right. Others seek to amplify the influence of their vote by engaging in a variety of political activities. Nevertheless, the belief is widely shared that the political system ought to be broadly responsive to the wishes of the electorate, which, in turn, ought to comprise most of the adult population. Through the ballot box, adult Americans have the opportunity to shape their political environment and to make...

  6. 2 Labor and Capital in the Worker Co-ops of the Pacific Northwest
    (pp. 20-44)

    The Pacific Northwest has been home to at least two major groups of worker co-ops. One of these is the plywood industry, the U.S. manufacturing industry in which worker ownership and management have extended most widely over the past eighty years. At this time, however, the plywood co-ops may well be in their twilight. The first plywood co-op, the Olympia Veneer Company, was established in 1921. After a successful experience, it was sold to the United States Plywood Corporation in 1954, when more than one-quarter of all plywood production in the Pacific Northwest was coming from the co-ops (and when...

  7. 3 The Relative Productivity and Profitability of the Co-ops
    (pp. 45-68)

    Although a substantial literature investigates the issue of the effect of profit sharing and of various forms of worker decision making on productivity, there has been much less research on whether coops are more or less productive than their capitalist-firm counterparts. Consequently, in their well-informed survey of the research, John Bonin, Derek Jones, and Louis Putterman (1993, 1307) conclude that “from the few studies that address directly the comparative productivity of PCs [producer cooperatives] and CFs [conventional firms], no consensus emerges.” The reason for this state of affairs, these authors suggest, is that few studies have met the demanding data...

  8. 4 Lessons from the Worker Co-ops of the Pacific Northwest
    (pp. 69-90)

    What, then, has been learned from the study of the plywood coops and the forest workers’ co-ops of the Pacific Northwest? First and most important, it is evident from the co-ops’ presence in the highly volatile plywood industry for more than seventy years that worker cooperative organizations are viable over a long period of time. Meade’s (1972, 427) declaration that co-ops flourish only in industries in which “the risk of fluctuations in the demand for the product [are not] too great” is unambiguously contradicted by the experience of the plywood co-ops. Large and unpredictable product-and input-market shocks require any organization...

  9. Notes
    (pp. 91-106)
  10. References
    (pp. 107-112)
  11. Index
    (pp. 113-117)