Commentary

In Times of Uncertainty, Family Businesses Help Anchor the Economy

By Seattle Business Magazine June 2, 2010

Our region is great at starting companies–unfortunately, a lot of them end up getting sold off. Wouldn’t it be nice if more of the companies stuck around?

John Cook had an interesting blog yesterday on the tendency of entrepreneurs in our region to start companies and then turn around and sell them. And it’s true, we’ve becoming a birthing area for new companies (think Immunex and Flexcar) that then get snapped up, resulting in a shift in headquarters, and jobs, to other parts of the country.

A lot of people will say that’s simply part of the process. People invest in Seattle companies, in part, because of the region’s past success in generating new businesses that sell for a premium. Hopefully, the money earned is then plowed into some new venture. Still, it hurts when companies reach a certain size then leave, resulting in the loss of many important jobs.

Family companies, however, have a better track record of sticking around. Companies like Bartell Drugs and Paccar have owners who are loyal to the community and seem to be more committed to keeping jobs in the community.

A lot of people might be surprised to learn that family businesses account for about half of the nations gross domestic product and generate nearly 60 percent of the countrys employment. Some say as many as four-fifths of the states business are family-owned.

Recognizing the importance of family businesses, Seattle University has established a successful Family Business Institute. Gonzaga University is launching a similar effort. Seattle Business has also launched its inaugural Washington Family Business Awards with the goal of recognizing these important players in our economy.

Look around you and some of the most important services on which you depend are probably provided by family businesses. If there is a company that your respect, or if you are part of a family business, make sure to nominate that business here. We think they deserved to be honored for the important role they play in our business community.

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