Dissatisfaction with economy among Flemish SMEs almost as high as in 2020
The dissatisfaction of Flemish small and medium-sized enterprises (SMEs) with the economy is almost as high as in 2020, the first year of the pandemic. This was shown in the latest SME survey published by Unizo, the Flemish organisation for the self-employed and SMEs.
Unizo gauges confidence among SMEs every quarter. For the third quarter in a row, pessimism is more widespread among entrepreneurs than optimism. “We see absolutely no recovery of entrepreneurial confidence even now that the covid measures have virtually ceased to exist”, says Unizo director Danny Van Assche. “The very negative score for the indicator 'satisfaction with the economy' is particularly striking. Rising prices of raw materials, energy and transport, plus the unprecedented indexation of wage costs, are causing headaches for entrepreneurs.”
“The consequences of the war in Ukraine create uncertainty and the energy bill weighs heavily."
Entrepreneurs are also concerned about profitability. They are having difficulty, if at all, passing on the increased costs and this is gnawing away at their margins. The barometer indicators that gauge future expectations are at their lowest since the beginning of 2020. This is when SMEs had to deal with the consequences of the corona crisis and strict containment measures.
“The consequences of the war in Ukraine create uncertainty and the energy bill weighs heavily. Automatic wage indexing means that we are faced with a wage-price spiral, because costs continue to rise”, Van Assche adds.
Because of the great pressure on profitability, Unizo fears there will be an increasing number of bankruptcies in the coming months.
The employers’ organisation sees solutions in an adjustment to automatic wage indexation combined with a tax reform, as a result of which those who work are rewarded more.
© BELGA PHOTO JASPER JACOBS