Almost two-thirds of US family businesses see recruitment of skilled personnel as a major challenge in the next 12 months and are predicting that the issue is likely to hamper growth, new research has revealed.
The PwC survey of 154 mid-sized US family businesses also found that 66% of respondents believe that staffing issues are likely to get worse over the next five years with many investing in training in order retain employees.
The staffing issues are thought to be one reason why only 16% of US family businesses are reporting aggressive growth for the next five years. Three quarters say they are expecting steady growth.
Other factors said to affect growth include market conditions, government regulation and competition.
Survey participant Debbie Trzcinski, vice president at second-generation marketing company Ivie & Associates, boiled the matter down to this: “When our workforce moves forward, the company can move forward as well”.
Her sentiment was echoed by William Elliott, chairman of a second-generation Texan electrical supply company that bears his family name, who said: “maintaining the proper personnel helps to support growth”.
The survey also found 73% of US family businesses do not have a robust succession plan in place for senior roles, while two in five respondents believe they will find it difficult to hand over control.
Nearly half of next-generation family members believe that succession is becoming increasingly difficult because of the growing age gap between leaders and their inheritors.
"We are seeing an increase in what we call the 'sticky baton syndrome,' where the older generation hands over management of the firm in theory, but in practice remains in control of what really matters," said Alfred Peguero, PwC's US family business survey leader.
"As the generational gap widens, the period between each transition gets longer. This means potential successors often are excluded from hands-on involvement and lack the experience needed to run a company," Peguero added.
The survey findings, which were only released in detail this month, formed part of a larger global report released by PwC last September. The global results also found that succession was an issue, with 80% of family businesses admitting they did not have a robust plan in place.