Digital Desk Staff
Family businesses say Covid unemployment supports are hindering their attempts to get people back working.
A new report outlines the State's reliance on family businesses to increase numbers in the work force, with corporate tax rules set to reduce Ireland's attraction to foreign employers.
The National Family Business Sentiment Report 2021 is compiled by the Family Business Network and business adviser Smith & Williamson, based on survey findings and contacts with family businesses of all sizes across the country.
The report founds that family owned businesses employ twice the number of people as foreign direct investment and the State combined.
“Faster progress is needed in incentivising return to work as the Pandemic Unemployment Payment [PUP)]has made it too easy for some former workers to prefer unemployment,” the report states.
“While progress is being made, the Pandemic Unemployment Payment has remained at an unnecessarily high level for an unnecessarily long period,” the report states. “The result, which affects locally owned firms much worse than high-margin foreign-owned firms, is that many local employers have found themselves competing against the PUP and the wider welfare system to get workers back working again.”
The enhanced PUP rate of €350 was introduced as Covid-19 lockdowns forced the closure of hundreds of businesses. The maximum available under unemployment benefit is €203.
PUP will be phased out between now and February 2022. The first cut, of €50, took place this week.
Capital gains tax was a bigger concern for family businesses. The report said it has forced many families to sell some, or all, of their business to meet capital gains tax bills as ownership of their business is passed on the next generation.
Respondents said family-run firms “have yet to see real reduction in the cost of insuring their business and their employees”.
Despite the fears, 60 per cent of family businesses are optimistic about bouncing back from Covid restrictions and hiring new employees.
Four in five say they are likely to create new jobs within the coming year, this is up from three in five last November.