Family businesses and labor relations

Do social relations differ between family businesses and nonfamily businesses? To answer this question, we examine the theoretical foundations of and empirical findings on the most debated issues: job security, compensation, organizational choices, job satisfaction, and territorial anchoring. Most findings indicate that the propensity of family firms to lay off employees is lower than that of nonfamily firms; however, this comes with the cost of lower average earnings, especially at the top of the wage pyramid. Family-run businesses report higher employee satisfaction, lower absenteeism, and fewer strikes on average. We analyze these results and suggest further explanations.