It's one of the toughest job markets in decades for college grads. So why not put your kid -- and your kid's fancy new diploma -- to work in the family business? Bad idea, says Allen Fishman, entrepreneur and author of the recently released 9 Elements of Family Business Success. In a conversation with Inc. senior reporter Kasey Wehrum, Fishman explains why hiring a family member straight out of college is a big mistake.
What's wrong with hiring sons and daughters out of college?
A big part of it is psychological. For the child, it means missing an opportunity to build that confidence that comes from succeeding outside the family-business womb. They will always wonder whether they could have made it on their own. It really causes them to question their management ability.
OK, but for the company, it's still a great asset to hire these kids, right?
Not really. Working somewhere new, they gain skills and ideas that may not have ever been tried in the family business. If they spend a few years with a large corporation, they'll have access to very expensive, top-notch training that you rarely see in smaller companies. If you hire them right out of school, they won't gain that knowledge and experience that might not be available in your family business.
Also, when your kid has some outside experience, nonfamily employees will think, OK, he might have just come into the business, but at least he has been running a nice budget somewhere else for a few years. They know you're not hiring your son or daughter simply out of nepotism.
But isn't it preferable that your child will at least have a job?
You need to consider what happens if the business goes under. I recently spoke to one business owner who joined the family manufacturing business right out of college. That business is now under attack from competition overseas. He worries whether he can succeed anywhere else. His whole life, he has never worked anywhere else besides the family business.
What if your kid never joins the business?
Is that so bad? We all want our children to live their lives and follow their dreams and passions. If they find they have a passion working somewhere else and they are happy, so much the better.