Researching Employer Practices in Family Businesses

The Family Business Research Foundation (FBRF) is using data from the UK Government’s Management and Wellbeing Practices (MWP) survey (DBT, 2024) to study employer practices and policies in family-owned firms in Britain and how they differ from non-family firms.

In 2013, the IFB Research Foundation published a study, Family Business People Capital [1], which took an in-depth look at people capital [2] and the employment and human-resource practices in family firms in the UK. The report presented findings from an analysis of data from the UK Government's 2011 Work and Employment Relations Study (WERS6).[3]

The Department for Business, Energy and Industrial Strategy (BEIS) commissioned Kantar Public and the National Institute of Economic and Social Research (NIESR) to undertake the MWP survey in late 2018 and early 2019.[4] The MWP survey was a survey of workplaces [5] and included almost 2,500 interviews with employers (private, public, or third sector) across Britain (DBT, 2023b). Its purpose was to gather evidence from employers about how they were responding to policy developments across a number of areas [6], including flexible working, in-work support for parents, and collective rights (DBT, 2023a,b). The survey covered topics included in earlier national employer surveys (such as WERS6 and the Work-Life Balance Employer Survey), which enables comparisons with findings from the MWP survey and these earlier studies.

The MWP survey included measures of family-business ownership and management (Kantar Public, 2023) [7], which makes it possible to compare the employer practices of workplaces of family-owned businesses with those of non-family firms. This enables us to examine whether the workplaces of businesses owned and managed by families tend to have different management practices or employment relations compared with non-family firms?

There are very few sources of evidence about the family-business sector available from well-designed surveys in the UK. The FBRF has used estimates of the prevalence of family ownership from the Office for National Statistics’ Management and Expectations Survey (MES) to investigate differences in the management practices of family-owned versus non-family firms (Oxford Economics & IFB Research Foundation, 2022). For the past decade, the FBRF's economic reports on the family-business sector have mainly depended on data from DBT's Longitudinal Small Business Survey (LSBS).

Employer practices in the UK have changed significantly in the five years since the fieldwork for the MWP survey was undertaken, particularly with the changes to working arrangements associated with the COVID-19 pandemic (DBT, 2023b). Nevertheless, the MWP survey remains one of the few national-level data sources where both family ownership and management are identified, and provides valuable information about family firms across all firm-size bands.

The FBRF’s new study in this area also has a methodological rationale. Quantitative research in the family-business field would benefit from improvements in the reliability, consistency, availability, and quality of data on family firms in the UK. There is an exigency to bring the definitions and measures of family business used across different government surveys (MWP, WERS, LSBS, and the MES) into better alignment. This would make it possible to synthesise evidence across different national surveys and data-sets and make meaningful comparisons between them.

The findings of the FBRF’s study of employer practices in family firms will be available from spring 2025. For more information about this project, contact the FBRF on info@fbrf.org.uk

Notes

[1] The final report from the project Family Business People Capital can be accessed here: https://www.fbrf.org.uk/reports/people-capital

[2] People capital can be defined as “the strength of knowledge, skills, behaviours, energy, loyalty and commitment which exist within the non-family members of a family business” (IFB and Tomorrow's Company, 2011).

[3] The 2011 Workplace Employment Relations Study (also known as WERS6) was the sixth in a series of national surveys of employment relations at the workplace level.  The aim of 2011 WERS was to produce evidence on employment relations and practices from a representative sample (N=2,680) of British workplaces. For more information about WERS6: https://www.wers2011.info/ and see van Wanrooy et al. (2023)

[4] More information about the MWP survey can be found here, including findings, results, methodology, and questionnaire: https://www.niesr.ac.uk/publications/findings-management-wellbeing-practices-survey?type=report

[5]  According to DBT (2023a), a workplace "refers to the activities of a single employer at a single set of premises (for example, a store of a supermarket, or a branch of a high street bank)". (2023a: 7)

[6] The policy developments included, for example: the provision of a right to shared parental leave and pay from 2015 (Industrial Strategy); the extension of the right to request flexible working to cover all employees with 26 weeks’ continuous service (Children and Families Act 2014); changes in balloting arrangements (Trade Union Act 2016); and the publication of the Taylor Review of Modern Working Practices in 2017 which highlighted the employee's voice in workplaces and recommended extending the Information and Consultation of Employees (ICE) Regulations (DBT, 2023).

[7] These measures included:

• Is the establishment part of a business that is majority-owned by the person or family who first set it up? Yes,  No, Don't know.

• Are any of this family actively involved in the day-to-day management of the business? Yes,  No, Don't know.

Source: Kantar Public (2023)

References

Bacon, N., Hoque, K. & Siebert, S. (2013). Family Business People Capital. June 2013. London: IFB Research Foundation. Available at: https://www.fbrf.org.uk/s/people_capital_report_june_2013.pdf [Accessed 07.11.24]

Department of Business and Trade (DBT) (2023a). Findings from the Management and Wellbeing Practices Survey. June 2023. Avaialable at: https://www.niesr.ac.uk/wp-content/uploads/2023/06/Findings-from-the-Management-and-Wellbeing-Practices-Survey-1.pdf?ver=ObjECdpNOopPRYmDHjhM [Accessed 08.11.24]

Department of Business and Trade (DBT) (2023b). The Management and Wellbeing Practices Survey 2018: Technical Report. June 2023. Available at: https://www.niesr.ac.uk/wp-content/uploads/2023/06/Findings-from-the-Management-and-Wellbeing-Practices-Survey.pdf?ver=pWMZao3u5OFTj0YnIpXX [Accessed 08.11.24]

Department for Business and Trade (DBT) (2024). Management and Wellbeing Practices Survey, 2018. [data collection]. UK Data Service. SN: 9253, DOI: http://doi.org/10.5255/UKDA-SN-9253-1

Kantar Public (2023).  Management and Well-being practices Questionnaire. September 2023. Available at: https://www.niesr.ac.uk/wp-content/uploads/2023/07/MWP-Appendix-A-Questionnaire.pdf [Accessed: 08.11.24]

IFB and Tomorrow’s Company (2011). Family Business Stewardship. London: Institute for Family Business. Available at: https://www.fbrf.org.uk/s/developing-stewardship-web.pdf [Accessed 07.11.24] 

Oxford Economics & IFB Research Foundation. (2022). The State of the Nation: The UK Family Business Sector 2021–22. Available at: https://www.fbrf.org.uk/reports/state-of-the-nation-22 [Accessed 08.11.24]

van Wanrooy, B., H. Bewley, A. Bryson, J. Forth, S. Freeth, L. Stokes, and S. Wood, (2013). The 2011 Workplace Employment Relations Study First Findings. London: Department for Business, Innovation and Skills. Available at: https://assets.publishing.service.gov.uk/media/5a7df9c540f0b623026885b2/bis-14-1008-WERS-first-findings-report-fourth-edition-july-2014.pdf [Accessed 07.11.24]