In the midst of mounting economic insecurity, fueled by widespread unemployment, foreclosures and budget cuts, many are seeking alternative models to business as usual. From community gardens to bartering networks, grassroots efforts are sprouting up across the country. One pillar of the trend is an international institution with over 160 years of experience in local, sustainable economic development: a cooperative.
Since the mid-1800s, cooperatives have promoted a people-centered model that sets them apart from conventional businesses. Unlike traditional corporations, which are owned and controlled by outside shareholders, cooperatives are businesses owned and democratically controlled by their members — the people who use their services or buy their goods.
Co-ops exist in a variety of forms in countless industries across the U.S. and around the world. United on the basis of member-ownership and democratic control — generally following the decision-making principle of "one-member, one-vote" — co-ops have a range of ownership structures. In whatever form they take, however, surveys repeatedly demonstrate that consumers rate co-ops as more trustworthy than investor-owned corporations.
In the U.S. alone, the model has been embraced by more than 130 million members, served by over 29,000 cooperatives operating in nearly all sectors of the economy.
Cooperatives play a vital role in local economic development, helping people improve their lives through jobs and access to goods and services. The demonstrated benefits have sparked growing interest in the cooperative movement worldwide.
In light of the economic crisis, many people have embraced worker cooperatives as an effective pathway out of poverty. Owned and controlled by the people who work in the business, worker co-ops have an impressive track record of providing stable jobs with asset-building potential, higher wages, a deeper connection to the local community and an array of personal and professional development opportunities.
Worker cooperatives often operate on the basis of a "triple bottom line," measuring success not simply by the money they earn, but by the well-being of their workers; their sustainability as a business; and their contribution to the community and the environment. Cooperatives have served as a foundation for growth of the green economy, where worker-owned businesses operate primarily in labor-intensive sectors such as recycling, solar installation, landscaping, green cleaning and deconstruction.
In Austin, Third Coast Workers for Cooperation, a cooperative development center dedicated to building worker-owned green businesses with low-income communities, is working with a group of low-income women to establish Yo Mamas Catering Co-op, a worker-owned catering business.
"We wanted jobs that would provide a good living for ourselves and our families," says Sylvia Barrios of Yo Mamas. "We've spent a lot of time working for other people. ... Now we want more control over our lives and we think Austin is ready for more worker-run businesses."
Indeed, Austin has its share of notable worker-run businesses: Ecology Action, a recycling center in downtown; Tribe Creative Agency, an advertising agency focused on the "Common Good"; and the Black Star Co-op, a worker-managed, consumer-owned brew pub.
As one of the more noteworthy cities for socially and environmentally responsible local businesses, Austin is ripe for more growth in the cooperative sector. Socially and environmentally responsible practices are not just a trend within cooperatives — it's just how they work. That's the cooperative difference.
Perez de Alejo is co-director of the Austin-based Third Coast Workers for Cooperation