A
B
C
D
E
F
G
H
People
People
People
Gap
People with with
without
without
Change
Total
No. of
Portfolio
Portfolio
Portfolio
Portfolio
(C-D)
Favor-
People in
(% Who
(% who
(% who
(% who
Minus
Oppose
Category
Sample
Support)
Oppose)
Support)
Oppose)
(E-F)
(%)
All Unmarried
2401
61
22
44
24
19
4922
Republicans
2106
75
14
54
19
26
6516
Private employee
3087
68
18
50
20
20
Retiree
1735
24
44
28
26
64
Source: Data from Rasmussen Research; calculations by the author.
would exhibit greater stability in employ-
"The Organizational Impact of Profit
ment but greater variability in compensation
Sharing," Gary W. Florkowski of Syracuse
over the course of a business cycle is now
University found a significant positive sta-
known as the Weitzman Theory--in honor of
tistical link between profit sharing on the
Martin Weitzman, whose 1984 book The
one hand and job satisfaction and organi-
Share Economy recapitulated an argument the
zational commitment on the other.
industrialists had made in 1939.61 In 1987,
A 1989 Brookings Institution anthology,
Kruse provided empirical support for the
Paying for Productivity: A Look at the Evidence,
contains two major essays on labor output
Weitzman Theory by showing that employ-
and worker capitalism. In "Alternative Pay
ment fell less in manufacturing companies
Systems: Firm Performance and Productivity,"
during economic downturns if they had prof-
Daniel J. B. Mitchell et al. concluded that
it sharing plans. For every 1 percent increase
Annual surveys
401(k)s and other profit-sharing plans had
in the overall unemployment rate, the profit
conducted jointly
improved employee performance in the
sharers reduced their workforce 2 percent,
1980s. "Profit Sharing and Productivity,"
compared with a 3.1 percent layoff rate
by PSCA and
among nonprofit sharers.6 2
by Martin L. Weitzman of Harvard Univer-
Hewitt Associates
sity and Douglas L. Kruse, was a meta-study
A 1989 Employee Benefits Report by the
between 1973 and
of 16 previously published investigations.
U.S. Chamber of Commerce lends support to
The authors concluded that profit-sharing
H. S. Murray's 1939 suggestion that a more
1988 found that
companies experienced a median 4.4 per-
flexible wage might actually increase the over-
profit sharing
cent productivity increase.
all compensation of labor. (The figures given
More recently, Douglas L. Kruse of
in Table 12 use Commerce Department
companies had a
Rutgers University investigated worker pro-
indexes to correct for the different mix of
13 percent
ductivity in 500 companies, half with profit
industries in each category.)
turnover rate
sharing plans, half without, from 1971 to
Community of Interests
1991. He reported that profit sharing
among partici-
increased worker productivity by 3.5 to 5.0
The businessmen who testified in 1939
pants compared
percent. Cash profit sharing had a more
thought that profit sharing and stock own-
with a 21.6 per-
immediate impact on productivity, while
ership plans would reduce labor strife, a ris-
deferred profit sharing plans such as 401(k)s
ing concern at the time. "We have not had a
cent national
had a greater long-term impact.
strike in 50 years," said Proctor & Gamble's
turnover rate.
The notion that profit sharing companies
Richard Deupress. "Our turn-over of labor
21