Maria Rosales always dreamed of owning her own business and had the know-how to do it. She grew up helping her parents run a restaurant, market, and farm in Mexico, and later helped her sister with her work at a banana export business. But when Rosales immigrated to the United States, she found she lacked the formal education and capital to start her own business. So she took a job on a Silicon Valley electronics assembly line.
Life changed for Rosales years later when she learned about Women's Action to Gain Economic Security, or WAGES, a San Francisco Bay-area organization that helps low-income women start businesses. The staff of WAGES invited her to join four other women in starting a cooperative.
Under a cooperative business model, each participant is both a worker and an owner of the venture, sharing the costs and profits equally.
"Cooperatives give more people access to business ownership," says WAGES executive director Hilary Abell. And they provide jobs that put workers' well-being first.
That's more important than ever in today's sluggish economy, when big companies are downsizing and outsourcing jobs to lower-wage countries. Unemployment in the United States now stands at 9.9 percent if workers who have given up looking for jobs and the underemployed are included. Add in the U.S. prison population, and the rate is 11.3 percent.
For corporate employers, obligations to shareholders means a never-ending search for lower costs, and that often means employees are shunted aside.
But that can't happen at a cooperative, because the workers, managers, and shareholders are the same people. They don't need to make huge profits for shareholders to stay in business, and there's no pressure to keep wages low.
Co-ops also have the advantage of needing only modest amounts of capital to get started. "People can pool their skills and resources," says Abell.
From the beginning, Rosales and her coworkers made the decisions, including choosing to run a housecleaning service.
WAGES trained the women to work with safe and natural cleaning products like vinegar, baking soda, and vegetable-based soaps. The women, accustomed to using harsh chemicals, were skeptical at first. But they were won over when the products worked well without causing the rashes and headaches that had plagued them when they used chemical cleansers.
That was in 1999. Today Rosales works as a general manager for Emma's Eco-Clean, the company she started with the other women from WAGES. The increased demand for all things green helped Emma's expand to 25 worker-owners. Meanwhile, WAGES launched two other eco-cleaning businesses and is planning a fourth.
One of those companies, Natural Home Cleaning Professionals, announced a year-end profit of more than $90,000 last year. The worker-owners voted to take 70 percent of that amount in bonuses and put the rest into growing their business.
Sharing the Wealth While successful in some markets, the cooperative business model faces challenges. One is that co-ops are just catching on in the U.S., which means financing new projects is difficult, and guidance for young cooperatives is scarce. To help fill the void, WAGES provides advice to those trying to start a co-op. "We don't want other people to have to learn the hard way," Abell says.
WAGES also shares co-op know-how through local, regional, and national co-op networks including the United States Federation of Work Cooperatives, a grassroots organization founded in 2004.
Another challenge is that each co-op worker-owner assumes much more decision-making responsibility than an employee in a conventional business. They must be prepared to vote on everything from the annual budget and hourly rates to whether an under-performing member should be asked to leave.
"We are like a family," Rosales says, and that helps with decision making.
Also important are the goals co-op members share. These include earning better wages and benefits than are offered at other jobs available to these women. "I worked for 11 years, and the most I made per hour was $11," says Rosales. At Emma's, "everybody is making from $12 to $15 an hour."
The cooperative model has also payed off for Claudia Zamora, a worker-owner at Natural Home Cleaning. Like Rosales, Zamora emigrated from Mexico and worked in the cleaning and restaurant industries before joining the cooperative. She was scared at first-she had to contribute $400 to join, and had to go in with seven other women on a $14,000 loan. But the benefits were worth it. Zamora was able to purchase a home, and she can arrange her schedule around the needs of her two children, ages five and eight.
For Rosales, one of the biggest rewards is working in a job her family is proud of. Her oldest daughter, a 21-year-old college senior, talks about her mom to her friends. "She sends me e-mails, and says how much she admires me and how much she appreciates all the hard work I do," says Rosales.
Also important is the empowerment and business knowledge Rosales has gained. "I feel like I can do any type of business now with the experience I got here," she said.
As jobs in the corporate economy disappear overseas or fall victim to downsizing, workers may choose to create their own jobs through cooperatives that they can control.