Family business a ‘good news story’ in the economy
PwC survey suggests attracting and retaining talent remains a challenge as boomers enter retirement.
TORONTO — Family businesses are a good news story in the Canadian economy but face challenges when it comes to attracting and retaining talent, according to a report by PwC Canada’s Private Company Services group.
The survey concludes that family businesses in Canada are growing: more than two thirds (67%) of respondents achieved topline growth in the last year, and an even larger percentage (85%) are projecting growth over the next five years.
It said this strength and confidence is likely a result of expected continued economic recovery, as well as the ability private family companies have to remain agile amidst economic uncertainty.
However, family businesses face challenges when it comes to attracting and retaining talent, with 71% citing this as their top concern over the next five years. They tend to require sophisticated leadership and a diversity of skill sets, but aren’t always able to provide market-competitive compensation.
These challenges highlight a need for family businesses to professionalize, something that is on the radar for only 21% of Canadian respondents over the next five years.
There is also a significant demographic shift occurring in Canada—baby boomers are retiring, creating a skills gap in the workforce and putting a squeeze on businesses. This is particularly challenging for the 27% of respondents looking to sell or float their companies—the aging workforce will create a highly competitive buyer’s market between 2018 and 2025, meaning that succession planning will be particularly crucial for those seeking to exit.
Eighty per cent of respondents said they measure success beyond profitability, and that they are committed to retaining staff even in bad times. They agree their culture and values are stronger (75%), they are more entrepreneurial (71%), make decisions faster (73%) and take a longer term approach to setting strategy (65%) than non-family businesses.
“If these businesses can invest in capacity and capability, bringing in the right people with the right skills, they’ll continue to be a key pillar of the Canadian economy,” said Sharon Duguid, director of the Centre for Entrepreneurs and Family Enterprise at PwC.