With customers staying at home during the pandemic, large numbers of businesses have shuttered permanently, unable to cover their payroll and rent. Emergency governmental assistance has sustained some businesses during this period of economic uncertainty, but the crisis has also stoked interest in a private sector remedy: cooperatives.
As Congress deliberates how to safeguard the country from future crises, policymakers should consider recent research that shows how so-called alternative enterprises can make local economies more resilient. Sociologist Marc Schneiberg finds that counties with more cooperatives, credit unions, community banks, nonprofit organizations, and universities experienced fewer job losses during the Great Recession and greater job growth in its aftermath. This path-breaking finding suggests that such organizations are better able than their shareholder-owned counterparts to retain workforces when the economy falters—and more willing to invest in their communities when markets pick up again.