We don’t fire! Family firms and employment change during the COVID-19 pandemic

Abstract

PurposeBy investigating the reactions of family businesses to COVID-19 pandemic this article aims to explaining how family firms are capable to preserve employment during hardship.Design/methodology/approachStemming from resource-based-view, we theorise that familiness is not directly associated with new hiring but instead fully mediated by pivoting strategic decisions (the propensity to transform the business).FindingsOur findings show that familiness triggers pivoting strategic decisions and consequently increases the likelihood of new hiring. Additionally, we found that the involvement of multiple generations strengthens this relationship.Practical implicationsFamily firms must consolidate their family human and social resources (familiness) and assure the presence of multiple generations in the firm because they can leverage their entrepreneurial disposition and increase the need to preserve employment and new hires during crises.Originality/valueThe main contribution lies in the explanation of the mechanisms that family firms deploy to overcome a crisis and thus explains why some family firms are more resilient than others in relation to firm’s employment during hardship.