DURANT, Okla. – As a small business owner, would you want your mom to work for you?
That’s one topic explored in a study conducted recently by three professors at Southeastern Oklahoma State University. Their findings (“The reverse family business: an emerging trend in entrepreneurship?’’) have been accepted for publication in The Academy Entrepreneurship Journal.
Under the traditional family business model, children often work for their parents. But, according to research, this may be changing today, as more parents are being hired by their children, who also happen to be small business owners.
There are several contributing factors, according to Dr. Martin Bressler, professor of marketing and management in the John Massey School of Business. Bressler, along with Dr. Kitty Campbell, Massey Professor and Chair of the Department of Management & Marketing (John Massey School of Business), and Dr. Brett Elliott, professor of mathematics, published the paper.
As part of their study, the professors developed a questionnaire that was distributed via email to small (less than 500 employees) business owners across the United States. This included such industries and enterprises as construction, energy, farm/ranch, manufacturing, retail, and service. Of the 828 respondents, 113 (13.9%) reported one or both parents working in their business.
The survey results indicated several reasons why parents are working for children, including: parent business expertise/financial backing; parent relationship with customers/suppliers; parents wanting to maintain a role in the company; and additional income for parent.
The results also indicated that it was more common for fathers to work for their children than mothers. With that being said, the survey showed that nearly as many small business owners reported both parents working in their business.
Another area explored by the questionnaire regarded the impact of work and family relationships. Small business owners were asked whether they believed their parent working in the business resulted in a closer relationship. Half (50.3%) of the respondents indicated there was no impact on the relationship; 32% said that their relationship with their parents became closer; and 17.6% found that their relationship became more difficult.
“The reverse family business has benefits for both the child and the parent,’’ Campbell said. “The payoff for the child is having a trusted employee. And it can give a retired parent a new sense of purpose as well as more income.’’
Even though research is limited on this subject, the results could be significant, according to Bressler.
“The relationship baby-boomer parents have with their kids today is much stronger than the relationship they had with their parents while they were growing up,’’ Bressler said. “This seems to help fuel this trend (parents working for children) and I think it will continue to grow. At this point in time, I would guess it is probably more common in rural areas than in urban areas. ‘’
The survey was distributed to five regions of the United States: Northeast, Southeast, Midwest, Southwest, and West.
Statistically, the survey results revealed that the northeast region of the country is most likely to have one or more parents working for a child, while the Midwest is the least likely.
And if, in fact, it is a growing trend, the benefits could, indeed, be very positive.
“It could actually improve the success rate for start-up businesses,’’ Bressler said. “This, in turn, would help employment and the overall economy.’’