RETAIN BUSINESSESin Arizona
As business owners retire, we help keep these businesses thriving in our communities
Employee ownership as a strategy for business retention
As of the 2020 Census, Arizona has an estimated population of 7,151,000 and a median household income of $56,500. Approximately half of all privately held businesses with employees in the state are owned by baby boomers.
Curbing the effects of the Silver Tsunami in Arizona
Small, locally owned businesses are essential to Arizona’s local economy and regional community vitality. Among the challenges the state faces is keeping businesses and the jobs they provide rooted in the community, as the Silver Tsunami – the retirement of baby boomer business owners – impacts Arizona.
The risk of the Silver Tsunami
Baby boomers (those born between 1946-1964) own half of all businesses with employees in Arizona. Regions in the US need to understand the risk of the Silver Tsunami as these business owners retire. Many legacy businesses will sell to out of area buyers or close down due to lack of succession planning.
A proactive approach in Arizona
Project Equity and our partners in Arizona launched this initiative to assist at-risk businesses in learning about the option of employee ownership. The initiative highlights the need for succession planning for local small businesses and focuses on transitions to employee ownership to address hundreds of Arizona business owners’ potential retirement.
The proof is in the numbers
Project Equity performed an analysis to quantify the number of privately held companies with five or more employees in Arizona that are 20 years old or older — a good indication that they need succession planning — and the impact if these businesses are not retained.
There are approximately 30,000 companies in Arizona that met that criteria. These longstanding businesses:
- employ an estimated 500,000 individuals
- generate about $100B in revenue
Local ownership over the long term
Keeping companies locally owned over the long term is a critical economic development strategy. Only 15% of businesses get passed onto the next generation and according to BizBuySell, the largest online marketplace for businesses, only one out of five of businesses listed for sale ever sell. We need more strategies for local business succession to avoid businesses closing their doors due to lack of planning. The good news is employee ownership is a viable path for many companies.
Employee ownership may be unfamiliar to many, but it keeps companies rooted in place, provides quality jobs and strengthens businesses for the long term. It also offers a ready solution to the retiring business owner: there’s a buyer right there under your nose — the very employees who helped you build the company.
Local ownership is important to Arizona’s future. Let’s make sure that, as baby boomers retire, the businesses they created live on.
About Project Equity and our partners
As a national organization, Project Equity advocates for and raises awareness of broad-based, democratic employee ownership, and we support businesses in transitioning to this highly beneficial business model. Through amazing local partners like Local First Arizona, we support this work in regions across the country.
Local First Arizona is on a mission to build equitable systems that earn that hometown pride and create a vibrant, inclusive, and sustainable Arizona economy.
Employee-owned companies in Arizona
Barrio Brewing Company
Commonwealth Electric Company
Pavement Recycling Systems
Precise Metal Projects
Spectrum Mechanical and Plumbing Contractors
Discover more employee-owned businesses at Certified EO
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