Why a New Generation of Workers Is Choosing to Join the Family Business
08:24 Share

Greenlight.com slash Spotify.

Here's your Money Briefing for Tuesday, April 22nd. I'm Mariana Aspuru for The Wall Street Journal. A tough job market can mean hours of networking, constant applications, and rounds of interviews. That's pushed some young workers to take a bigger interest in the family business.

What you saw before was that people really tended to stigmatize returning to their family business. There was this sense that it was taking the easy way out. They wanted to strike out on their own. Now we're seeing a change. We're seeing more support towards that decision. We're seeing more understanding of it and really the most excitement that we've seen in a generation. After the break, we'll hear more from Wall Street Journal reporter Rachel Wolf about how they're navigating it. ♪

Does it ever feel like you're a marketing professional just speaking into the void? Well, with LinkedIn ads, you can know you're reaching the right decision makers. You can even target buyers by job title, industry, company, seniority, skills.

Wait, did I say job title yet? Get started today and see how you can avoid the void and reach the right buyers with LinkedIn ads. We'll even give you a $100 credit on your next campaign. Get started at linkedin.com slash results. Terms and conditions apply. More workers are choosing to work for mom and dad. Wall Street Journal reporter Rachel Wolff joins me.

Rachel, you looked at some data that tells us that there's been an increase in kids joining the family business. How much of a shift is it? What we found is that the share of small businesses that employ a young adult child of an owner, so we

looked at it very specifically with the help of payroll provider Gusto, and it's up 13% just in the past year. So it's January to January. And then it has actually doubled since 2018. So we're seeing pretty significant movement. It's still a small share of businesses that are doing this, but that change is very interesting. What are some of the primary reasons why they're opting to work for the family business?

Small business analysts told me about both push and pull factors for young people joining a family business. Some of the push factors include the fact that this is a generation that came of age during the pandemic. Now they're older.

Worried about being replaced by AI and the effects of an escalating trade war. And then there's this pull factor, which is the Gen X and boomer parents who own the vast majority of small and medium-sized businesses in the country are looking towards retirement and trying to figure out their succession planning. So feeling a little bit more urgency about getting their younger family members involved. How new is this? Was it more common for previous generations to join the family business?

There's definitely a mindset shift from a decade ago, the analysts I spoke to told me.

What you saw before was that people really tended to stigmatize returning to their family business. There was this sense that it was taking the easy way out. They wanted to strike out on their own. Now we're seeing a change. We're seeing more support towards that decision. We're seeing more understanding of it and really the most excitement that we've seen in a generation. How are their parents, and I guess now their bosses, doing?

feeling about it? Overall, they seem really thrilled that their kids want to join their businesses. I spoke to a metal fabrication company in Minnesota, and the dad took over the business from his own dad, really did not expect his sons to join the business. Neither of them studied anything having to do with manufacturing, but

both of them have ended up joining in recent years and now plan to take it over. And so it was a bit of a learning curve because they needed a little bit extra skill training, which is something else I talk about in the piece that there can be a bit of a higher barrier. There are certainly unique challenges to having your mom or dad as your boss, but everybody I spoke to seemed to really enjoy it and it seemed like it was going really well. Yeah. I mean, I can only imagine you spend

a lot of time with your coworkers. If those coworkers were your family, you're going to need different skill sets. Yeah, I'm not sure it would be for me, but it definitely seems to be working for all the people I spoke to for the story. Rachel, this is a really interesting shift because it involves, for some people you spoke to in the story, foregoing what they studied and got a degree in to work for the family business.

How have they been navigating that? So I spoke to somebody who majored in music performance on the euphonium, which is a type of small tuba. And he had no plans to go work for his mom's web consulting firm. But

He graduated into the pandemic. And so he decided to come on full time to work for the family business. And again, he really loves it. He's a little bit less sold on taking it over. He's not sure yet. He doesn't know if he's ready to commit for just working for this one company for the rest of his life. His mom is really into the idea of him taking it over. But overall,

They seem to, his mom and him, to love working together. Like there were definitely specific challenges. His mom told me about adjusting, his name is Max, adjusting Max's job description to better fit his interests, even if it wasn't necessarily exactly what was best for the company and trying to prevent Max from having to work on things that he didn't want to do, even if they were necessary. But over time, his mom has just realized, you know,

Even though you always want to see your kid happy, happy, happy, the job's the job. Sometimes you have to do things you don't want to do. And so I think it's just been an adjustment over time. But yeah, they get along so well. It was honestly really cool to talk to all these people. What are some of the big takeaways that you got from reporting this story, Rachel? Yeah, I think that it's okay to use your family language.

as a networking tool. And there's no stigma in that, especially in a tough job market. You have to use the resources you have at your disposal during a tougher time than we've seen in a while for landing an entry-level role.

That's WSJ reporter Rachel Wolff, and that's it for your Money Briefing. This episode was produced by me with supervising producer Melanie Roy and deputy editor Chris Sinsley. I'm Mariana Aspuru for The Wall Street Journal. Thanks for listening.