Study: A Fifth of Employers Used Broad-Based Options

March 31, 2004 ( - Some 16 out of 100 workplaces connected to public stock market companies granted stock options in 2002 to more than half of their employees, while four of every 100 closely-held businesses gave options to most workers in 2002.

A new national survey found, for example, that 57% of workers in computer services hold company stock options as do 43% of workers in communications, and 27% in the finance industry.

Option-holding employees span both manufacturing and service industries and extend beyond the high-tech sector the study showed. In durable manufacturing nearly a quarter (23%) of workers hold stock options as do 17% of workers in non-durable manufacturing. Meanwhile, in service industries, 13% of the employees in transportation hold stock options, as do 11% in both wholesale and retail services. While only a scant 4% of service workers hold stock options, one in ten blue collar workers now holds options.

The study, by Professors Joseph Blasi and Douglas Kruse of Rutgers University’s School of Management and Labor Relations, and Professor Richard Freeman of Harvard University’s Department of Economics, found that 14 million American workers or 13% of the entire private sector workforce hold stock options.

A large segment of workers holding stock options, 94%, consider themselves part of the middle class, working class, or lower class. Only 15% identify themselves as managers, while 59% have annual salaries of less than $75,000.

The study is based on the 2002 General Social Survey (GSS) and the 2003 National Organizations Survey (NOS) conducted by the National Opinion Research Center at the University of Chicago.