After more than a year of whipsaw change brought on by the pandemic, many business owners have decided to retire. A recent survey of business owners conducted by the Wilmington Trust found that the pandemic is behind this rush to retire, adding another unexpected wrinkle to a devastating year. But what’s the right succession plan? It’s no small consideration for an owner who has spent a career building a business and wants to see that legacy continue. For many in the construction industry, that answer is increasingly found in an employee stock ownership plan, or ESOP, which allows for continuity in the sale process, and can provide tax savings as well. An aging industry Indeed, the construction industry is ripe for a transition to the next generation. The median age of construction workers increased to 42.9 from 2010 to 2020, an increase of 1.3 years. For the economy as a whole, the increase was 0.5 years over the same time frame. And many owners of construction firms are at an age where they need to consider succession planning. According to the latest survey on ownership transfer and management succession by research firm Future Market Insights, a majority of those surveyed plan to exit their business in the next five years or so. But at the same time, more than 50% reported that they do not have an ownership transfer plan. The exit strategies usually fall into five categories: READ FULL ARTICLE>>
