Family Businesses – Opportunities in Enterprise

If you run a small or medium sized business, do you employ any family members? Currently, more than a fifth (21%) do so. The impact can be great – a staggering 94% of SMEs employing family members felt that their business had benefited as a result.

The source of these figures is specialist public liability insurance providers, Hiscox, who carried out a survey of 1000 UK business owners on the subject of family employment. Interestingly, 43% of those currently employing family members said that this was due to the recent recession. A lot of SMEs have struggled due to happenings in the financial world, but employing a family member could help you weather the storm.

One reason for this could be that the recession has led to people with the right skills being available: if there is someone in your family who has been made redundant and has great experience and skills, employing them in your business could be mutually beneficial.

Of course, when employing family members, there are things to consider. The Hiscox survey found that 43% of those questioned felt that the biggest risk was keeping family and work life separate. A further 25% were worried about family politics but positively, while succession of business ownership is generally seen as being a big issue, only 8% felt that this was a risk.

While this shows that there are definitely issues to consider when employing a family member, the fact that you already know them means you are more likely to be able to easily identify the relevant risks. Plus, your pre-existing shared interests mean that it’s in both your interests to make it work. With the majority of SMEs in this study who employ family members saying that it’s a good thing to do, there are clear benefits to the business that can be found.