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WNC Business

The Silver Tsunami: Preparing for “the Largest Wealth Transfer in History”

May 04, 2025 11:07AM ● By Emma Castleberry

By 2030, all Baby Boomers—a generation of people born between 1946 and 1964, who own half of the nation’s privately held businesses with employees—will have reached or surpassed the age of 55, a long-held milestone for retirement. This phenomenon, often referred to as the “Silver Tsunami,” carries profound implications for the economic future of local communities, particularly in regions like Western North Carolina. “This is actually the largest wealth transfer in history,” said Anne-Claire Broughton, founder of the North Carolina Employee Ownership Center. 

As Baby Boomer business owners prepare to step away, the challenge becomes clear: How can these businesses transition successfully while preserving jobs, maintaining local ownership, and ensuring long-term economic stability? Broughton says that one of the most obvious solutions is employee ownership—an often-overlooked but highly effective strategy that secures business continuity while empowering workers.

The Scope of the Silver Tsunami

In North Carolina, nearly 79,000 businesses have owners who are 55 and older. Collectively, these businesses generate $165 billion in revenue and employ approximately 879,000 people.

In the 18 westernmost counties of the state, more than 10,600 businesses have owners over the age of 55, employing more than 100,000 individuals and representing about $3 billion in payroll and $16 billion in revenue. The phenomenon affects all industries, with a high concentration of retirement-age owners in Professional Services, Construction, and Retail. Some counties are more at-risk than others when it comes to the Silver Tsunami: in Polk County, for example, nearly 80 percent of the regional businesses are held by owners over the age of 55. 

More than half of small business owners have no succession plan in place, making them vulnerable to sudden closures, forced sales, or buyouts from out-of-state corporations.

“Many business owners would love to pass on their business to their children,” says Broughton. “But some don’t have children or the children don’t have an interest in the business.”

Broughton has found that many business owners assume that selling their enterprise will be a straightforward process, but Broughton says there is only a 20-30 percent success rate for businesses who list for sale with a broker. “Many of these businesses are in danger of closing down if they cannot find a buyer.”

The impact of these closures extends far beyond individual business owners. Locally owned businesses are economic anchors, keeping wealth within communities, supporting local suppliers, and providing stable employment. Roughly 70 cents of every dollar stays within the local economy when a business is locally owned, whereas that figure is significantly less for businesses that are owned by entities outside of the community. “There are so many locally rooted businesses that we all rely on—where people have jobs, they contribute to the community, they support the Little League team, they are members of the Chamber of Commerce,” said Broughton. “If those businesses go out of business or are bought by someone out of state, we’re in danger of these businesses being replaced by huge national chains.”

The Challenge of Transitioning a Business

Succession planning is a complex and often emotional process, particularly for small business owners who have spent decades building their companies. “It’s especially important for small business owners to prepare for an ownership transition as they approach retirement because their business often represents not only their primary source of income but also the economic backbone of their communities,” says Jenna Rae Grayson, director of business transitions at The Industrial Commons, a nonprofit in Morganton. 

Unlike large corporations with established succession plans, small businesses tend to be deeply tied to the personal relationships, expertise, and leadership of their owners. Without a plan, these businesses risk significant disruption, particularly in rural areas where a single business can be a key employer. “From my experience working with business owners, their top concerns are preserving the legacy of their business, supporting the people who helped them build it, and ensuring jobs are not lost in their community,” Grayson said.

The challenges of business transitions are multifaceted—legal, financial, and operational. “Ownership transition is complex, no matter how you approach it,” Grayson said. “Whether selling to family, management, or through an employee ownership model, the process can be time-consuming. Early planning allows owners to control the timeline, maximize the value of their business, and ensure that the new owners are well-prepared to successfully fund and sustain the business.”

The Solution of Employee Ownership

One of the most effective tools for business succession planning is employee ownership. Whether through an Employee Stock Ownership Plan (ESOP), a worker cooperative, or an Employee Ownership Trust (EOT), these models allow businesses to transition while maintaining local control and keeping wealth in the community.

“Employee ownership isn’t a niche or idealistic concept,” Grayson said. “It’s a practical, proven tool for succession planning and economic development. It supports job and skill retention, maintains community-rooted businesses, and allows those who have put in the time and work to become owners, opening a new age of entrepreneurship and building long-term economic resilience.”

Studies from the National Center for Employee Ownership show that employee-owned businesses experience 2% higher sales and employment growth year after year. Employee-owners are six times less likely to be laid off and are 50% less likely to lose their jobs during economic downturns. Additionally, median wages are 33% higher, and household net worth is 92% greater than in traditionally owned businesses.

A Case Study: Equinox Woodworks

Equinox Woodworks, a residential construction company in Burnsville, North Carolina, transitioned to an employee-owned cooperative in 2023 with support from The Industrial Commons.

The motivation behind the transition was twofold: sharing decision-making responsibilities and improving employee retention. “Parts of the company didn’t [receive] the energy needed because of only having one owner,” said Todd Kindberg, the business’s former owner. Transitioning to an employee-owned model allowed for leadership to be distributed among multiple people.

The transition process took nearly two years and required careful legal, financial, and operational planning. “We absolutely could not have made the transition without the help of Aaron Dawson from The Industrial Commons and Rob Brown from the Cooperative Development Institute,” says Meghan Lundy-Jones, one of the new employee-owners. “We met with them extensively in the beginning and they provided a ton of resources for us to use as we explored the various ins and outs of our new governance structure.”

Employee ownership was designed in part to help Equinox tackle the challenge of retaining skilled workers in a rural area. Lundy-Jones said they aren’t entirely sure just yet how the transition has influenced recruitment and retention. “The folks who decided to pursue ownership when we first transitioned are still owners and plan to stay in that role for some time,” she said. “We’ve had several employees become eligible who have not chosen to become owners but have stayed with the company anyway.”

Even if an employee chooses not to become an owner, they are still invited to be involved in decision-making processes. “Where it once was the sole owner’s discretion to make a business decision, we now use a consensus-based format that includes feedback from all employees,” said Lundy-Jones.

“By sharing and delegating, we can take on more,” Kindberg said. “We are able to do things I‘ve wanted to do for 10 years—things that are possible because we have more people to attend to them.”

Preparing for the Shift: Success Planning

For small business owners nearing retirement, the Silver Tsunami presents both a challenge and an opportunity. Those who start planning early will have more options and greater control over their business’s future. The consequences of failing to plan are clear: potential closures, job losses, and economic instability.

“The wealth gap is at feudal levels right now,” said Broughton. “This [shift could give] your average person a chance to build a little bit of wealth.” 

For business owners who have yet to develop a succession plan, it’s really never too early to start. The transition may be complex, but with proper planning and support, business owners can secure their legacy while strengthening the economic fabric of their communities.

Learn more at NCEOC.org and TheIndustrialCommons.org.