Family businesses have been disproportionately impacted by Covid-19, according to a new DCU study.
Eighty-three per cent of family businesses in Ireland reported Covid harming their business, well above the national average of 60 per cent for all Irish enterprises, according to a newly published study from DCU’s National Centre for Family Business, which surveyed 250 businesses in varying industries across Ireland and Northern Ireland.
The survey reported several other key findings, including that 47 per cent were forced to impose temporary or permanent layoffs, 28 per cent reverted to reduced working hours, 53 per cent shifted to remote work. Ninety-eight per cent of family-run companies reported that the pandemic will change their business forever.
Ian Smyth, lecturer of Human Resource Management at Ulster University Business School, which partnered with DCU to complete the study, said he tried to look at the findings positively.
“There are reasons to be positive: the resilience and adaptability displayed by the firms that participated is commendable, as is the loyalty and dedication of their staff,” he said. “Our family businesses have been through so much and overcome so much, and that’s really what I want to take away from [the study]”.
The study pointed to several reasons for the discrepancy in difficulty between family and non-family-run enterprises. One was that family businesses are generally smaller, especially compared to the multinational companies that skew what the average Irish business looks like. With smaller size and less revenue, family businesses, on average, can be less financially resilient than a larger company with larger margins.
Another factor the study pointed to, though, was how family business culture compares to other enterprises. According to its fundings, the study said that family businesses are more likely to side with their staff, holding back harsh layoffs or pay cuts that other, larger companies may deem necessary for survival.
With 64 per cent of all businesses in the Republic of Ireland being family-run, the report suggested that all family businesses make the best use of government supports to “maintain their critical presence in our country and our economy”.
By Devin Sean Martin