Family business owners are having trouble attracting and retaining talent, finds a new PwC Canada report.
At the same, however, they’re growing. Over the last year, more than half (67%) achieved topline growth, and the majority (85%) are projecting continued growth over the next five years.
Their strength will come from the continued economic recovery in Canada, as well as from the flexibility of private family companies when it comes to innovation.
“Family businesses are making the most of the economic recovery and are pushing forward in their plans for growth,” says Saul Plener, national private company services leader at PwC Canada.
“While they remain cautious about investing in international markets, they continue to have a strong sense of confidence and optimism towards the road ahead.”
As they grow, their main challenge will be retaining talent employees, given 71% cite this as their top concern over the next five years. This is troublesome since family-owned companies often require sophisticated leadership but can’t provide market-competitive compensation.
Furthermore, there is a significant demographic shift salted to occur over the next few decades; Baby Boomers are retiring and creating a skills gap in the workforce, which will put a squeeze on small businesses.
As a result, 27% of survey respondents are looking to sell or float their companies today before the buyer’s market becomes highly competitive between 2018 and 2025.
Still, the remaining owners say they’re committed to retaining staff, even in bad times. Besides profitability, they have confidence in their cultures and values (75%), their entrepreneurial spirits (71%), and their ability to make decisions quickly (73%).
“Family businesses add a dynamic, robust and often complex layer to the general business community, and their operational models often reflect the agility needed to survive in today’s environment,” says Sharon Duguid, director of the Center for Entrepreneurs and Family Enterprise at PwC.
“Their sense of responsibility and community spirit lends itself well to a harsh and competitive market, and if they 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.”