NCEO Completes Study on ESOPs as Retirement Benefits

In a project funded by the Employee Ownership Foundation, the NCEO did an extensive analysis of ESOP companies using data from the U.S. Department of Labor. Unlike prior research, the study carefully compiled data from multiple plans within a single company. It comes to several clear conclusions:

• ESOP companies are more likely to offer a second defined contribution (DC) plan than non-ESOP companies are to offer any DC plan at all;
• ESOP companies contribute substantially more to their ESOPs than companies with non-ESOP DC plans contribute to their DC plans;
• The average ESOP participant has 20% more DC assets than the average participant in a non-ESOP DC plan, and far less of it comes out of the employee's pocket;
• Considering only DC assets originally contributed by the company, ESOP participants have approximately 2.2 times as much in their accounts as participants in comparable non-ESOP companies with DC plans.

The full study is available at this link (19-page PDF), and the supplemental tables are at this link (12-page PDF).