The New Jersey Economic Development Authority (NJEDA) has announced a significant collaboration with the Rutgers University School of Management and Labor Relations (SMLR) to foster employee stock ownership plans (ESOPs) across the state. This partnership aims to create educational and informational programs to increase the number of New Jersey businesses implementing the ESOP model. Professor Bill Castellano, Executive Director of the New Jersey/New York Center for Employee Ownership, will be leading the charge. “A large percentage of retiring business owners have few succession plan options, and don’t realize they can sell the company to their employees instead of closing up shop,” he said. “Employee ownership strategies save jobs and help to keep the business and the local economy going.”

In the official NJEDA press release, Governor Murphy highlighted the benefits of ESOPs, emphasizing their potential to provide a sustainable succession plan for businesses and a substantial financial benefit for employees. Despite the success of ESOPs nationwide, New Jersey has lagged in adopting this model, with only 88 ESOPs currently in place. The initiative, funded by $2 million from the State Fiscal Year 2024 Appropriations Act, will develop technical assistance programs and outreach initiatives led by Rutgers' Institute for the Study of Employee Ownership and Profit Sharing. This effort is part of a broader strategy to address wealth disparities, particularly within Black and Hispanic communities, as outlined by the Wealth Disparity Task Force established by Executive Order 262.

In 2021, New Jersey governor Phil Murphy issued the aforementioned Executive Order 262, which established the Wealth Disparity Task Force and tasked it with examining the causes of, and the creation of remedies for, the longstanding wealth disparities that affect Black and Hispanic or Latino New communities in the state. As part of the State Fiscal Year 2024 Appropriations Act, $6 million of funding was allocated to the NJEDA for wealth disparity initiatives based on the work of the Wealth Disparity Task Force. That same year, the NJEDA entered a memorandum of understanding with the New Jersey/New York Employee Ownership Center at Rutgers University in New Jersey to establish a program to provide outreach and technical assistance to encourage the growth of employee ownership in the state.