What succession planning could mean for local firms and economies
Writer: Melis Turku Topa
September 2025 — Business succession planning in the United States has moved from a “maybe someday” exercise to a front-burner concern. Over half of U.S. small-business owners are now over 55 years old, making the issue of exit, ownership transition, or closure increasingly pressing. Over 2.9 million businesses in the U.S. are owned by people in this age group, supporting 32 million employees, generating about $1.3 trillion in payroll and accounting for $6.5 trillion in revenue.
Despite this, many owners remain underprepared. A U.S. Bank survey found that while most business owners want to pass on something meaningful, be it their business, legacy, or wealth, the gap between intention and action is wide. Only 54% have created a formal succession plan. Of those without a plan, common barriers include feeling overwhelmed, uncertainty about how to start, or difficulty identifying a successor.
“For many business owners, short-term priorities associated with running a business might feel more urgent than planning for future succession,” said Katherine Roy, principal of retirement products at Edward Jones, as cited by a report by the North American financial services firm. Among owners who acknowledge retirement or incapacity will eventually force a transition, one-third still don’t see succession planning as a priority, according to surveys by Edward Jones.
The financial stakes are large: more than 73% of privately held companies plan to transition ownership in the next decade, according to Exit Planning Institute data. Yet many of these transitions fail, particularly in family-owned businesses, where governance challenges, family dynamics, or lack of planning structure can derail the process.
In Pittsburgh, these national trends are echoed in the advisory community and in the practices of local firms. The region has seen growing interest in tools like ESOPs (Employee Stock Ownership Plans), board governance, and structured exit planning. Firms such as Minto Law Group emphasize that “every business succession client brings its own set of unique problems and opportunities” and that succession must be dealt with “in a sensitive yet straightforward manner.”
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Some local public policy in Pittsburgh has also begun to support ownership transition planning. Pittsburgh’s City Council has held hearings on employee ownership as a succession strategy that can help save jobs, keep businesses local, and improve retirement security for employees.
These issues resonate in western Pennsylvania, where family-owned firms and closely held businesses remain central to the economy.
In his interview with Invest:, Robert Fragasso, chairman and CEO of Fragasso Financial Advisors, pointed to structure, governance, and alignment as critical to succession success. “Our model is the key differentiator,” he said. “We have one centralized book of business, salaried employees with performance-based bonuses, and an Employee Stock Ownership Plan (ESOP) structure. Unlike some firms where advisers own their own books, we maintain full control over our assets and direction.
Fragasso added: “For example, a well-known third-generation firm we had considered merging with had no succession plan and allowed advisers to control their own books. When a team left, they had no recourse. We avoided that pitfall because our team is fully aligned.”
He also notes that succession isn’t peripheral; it’s built into the firm’s DNA. “Succession planning is another priority. Our ESOP, outside board of directors, and structured governance ensure continuity. Strengthening our executive team and fostering collaboration are essential as we prepare for future leadership transitions.”
At JFS Wealth Advisors, the importance of succession emerges in both client work and firm culture. “We have developed a niche business to assist private business owners in the region. Many private business owners have a lot of their wealth tied to their businesses. They need to develop plans to realize their wealth and also need assistance with ownership succession, so we have a team dedicated to this and they are experiencing a lot of success,” said Robert Jazwinski, founder and co-CEO.
The next generation of succession planning will focus less on reacting to crises and more on building intentional pipelines. As Society for Human Resource Management notes, “Succession planning is a focused process for keeping talent in the pipeline. It is generally a 12- to 36-month process of preparation, not pre-selection.” This approach shifts the emphasis from choosing one heir-apparent to cultivating multiple leaders who can adapt as the business evolves. In Pittsburgh, where many firms are simultaneously navigating demographic changes and economic diversification, this mindset could help businesses remain resilient during inevitable leadership transitions.
The imperative is to start now as broader industry voices like AIHR warns, “Organizations who fail to plan or create a succession pipeline successfully run the risk of losing the confidence of their stakeholders and investors from uncertainty and unfamiliarity.”
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