Αρχική Press Releases IME GSEVEE survey - July 2014 – Biannual portrayal of economic climate in small enterprises (with 0-49 employees, which make up 99,6% of Greek enterprises)
IME GSEVEE survey - July 2014 – Biannual portrayal of economic climate in small enterprises (with 0-49 employees, which make up 99,6% of Greek enterprises) PDF Εκτύπωση E-mail

The situation for the real economy and small enterprises goes “from bad to worse”, according to IME GSEVEE survey for the first half of 2014. Two out of three small and medium-sized enterprises found that during this half their turnover, demand, and orders, have been decreased, while the overall fall in turnover on an annual basis (July 2013- July 2014) decreased by 20% and since the beginning of the crisis it has reached 74%. One out of five small and medium-sized enterprises that until now has endured estimates that there is a great risk for it to stop operating until the end of the year, and, thus, closures will come close to 15.000.

The situation for micro enterprises is more dramatic as more than half of them say that they will be at the risk of closure within next half. The outlook on employment, in enterprises’ finance, liabilities and debts is similar.

Noteworthy, as far as the political situation is concerned, 72,5% of entrepreneurs says that none out of the existing political parties does represent its interests, a figure increased by 12% compared to July 2013 survey. In small and medium-sized entrepreneurs’ choices, SIRIZA (Coalition of The Radical Left) comes first, New Democracy comes next, while the outlook one year before (July 2013) has been the other way round with Nea Dimokratia (New Democracy) coming first.

The main findings of IME GSEVEE survey, carried out in cooperation with the company MARC SA on a sample of 1051 micro and small enterprises (with 0-49 employees), throughout the country, from 2 to 9 July 2014 read as follows:

A. ENTERPRISES’ OVERALL ECONOMIC SITUATION

  1. Although the macroeconomic indicators lead to the conclusion that the Greek economy has been stabilised, indicators on entrepreneurial activity, especially by small and medium-sized enterprises, remain on the negative side. Close to 2/3 of small and micro enterprises still follow a downward track, without any recovery prospects at sight. For the first half of 2014, assessment is still negative, as 64,7% of enterprises said that its situation deteriorated.
  2. In more detail, about 2 out of 3 enterprises during this half found out as well decrease in turnover (64,3%), in demand (64,4%), in orders (67,8%). According to IME GSEVEE estimations the overall fall in turnover during the last year reached 20% (July 2013-July 2014). The overall fall in turnover since the begging of the crisis reaches 75%. Liquidity and investment indicators are particularly negative, as once again 72,8% of enterprises showed deterioration in the liquidity indicator, while barely 8,7% proceeded in investments.

Β. CLOSURES- ENTREPRENEURIAL ACTIVITY

  1. Compared to February 2014, enterprises’ prospects on the half get significantly deteriorated (-44,8% compared to -35,4%). As a matter of fact, 21,4% out of them sees a possible business closure during the next half. This means that closures during the next half will come close to 15.000.
  2. The figures on micro enterprises are particularly negative, as more than half out of them say that they are at risk of closure during the next half.

C. LIABILITTIES- DEBTS

  1. The most significant problem that enterprises face and gets worse in 2014 is the accumulation of debts and the now confirmed inability for payments for a large part of enterprises. Most enterprises still have high arrears towards every “creditor” category. The largest part of late debt payments by enterprises has to do with debts towards OAEE, the Social Security Fund for the Self-employed (41,7%). Debts towards the tax authority come next (31,8%), Public Utilities (31,6%), banks (26,5%) and IKA, social security contributions (20,9%). 1 out of 4 enterprises has arrears towards suppliers and rent payments.
  2. 34,7% of enterprises estimates that it will not be able to meet tax obligations for 2014, while the respective figure regarding inability to meet social security obligations comes up to 35,7%.

D. EMPLOYMENT

  1. Given that 15.000 enterprises will be closing down during the next half, according to IME GSEVEE estimations, this means that there is risk for 42.000 employment posts losses (employers, self-employed, employees). It should be noted that during the first half of 2014 job losses (for employees) in SMEs are estimated at 24.000.
  2. It is shown that job losses (lay-offs) have been decreased compared to the years before, a fact also shown by ELSTAT workforce surveys. Thus, while one year before, the balance between recruitments – lay-offs stood at, during the first half of 2014 this balance stands at 1:1,5. This slow-down shall not be attributed to a recovery of entrepreneurial activity, rather to rapid changes marked in the employment conditions; this is due to the fact that:

a) the minimum wage has been reduced

b) about half of the employment posts in small and micro enterprises have been transformed into part-time or/and temporary employment posts

c) half enterprises face severe problems in paying wages in time

Ε. ENTERPRISES FINANCE

  1. The relation between the banking system and the majority of small and medium-sized enterprises has been fatally broken. Before crisis, according to IME GSEVEE survey, about half enterprises hadn’t financed their investment activities through bank lending. This figure hiked at  73,7% during crisis.
  2. Out of 73,4% that did not get any credit during the last 5 years, 65,5% (that is, 48% out of the total of enterprises) says that it didn’t have to address itself to bank lending and that the capitals it owed have been enough. 34,5% (that is 25% out of the total) that did need capital considers that the conditions for access to finance are prohibitive to this end.
  3. About half enterprises (47,1%) consider that lower interest rates would make their access to lending easier.
  4. Out of the enterprises that have got a loan by a bank, 46,2% says that it is late in loan payments in full.

F. SPECIAL ISSUE- POLITICAL SITUATION

1) 72,5% of entrepreneurs says that none out of the existing parties represents its interests. This figure increased significantly in an one-year period (60% in the previous climate survey, July 2013) and demonstrates the large representation crisis that characterises the Greek political system.

 

* The survey presented is the second for 2014, carried out by GSEVEE Small Enterprises’ Institute in cooperation with the company MARC SA on a biannual basis since May 2009. It was carried out on a sample of 1051 micro and small enterprises (with 0-49 employees), throughout Greece, between 2  and 9  July 2014, with the main aim to portray the economic climate in micro and small enterprises, in manufacture, trade, and services sectors, which make up 99,6% of enterprises in Greece. The findings of this survey can be compared to the respective ones of the previous surveys (February 2010 – February 2014). These surveys are the only tool available, throughout Greece, to record the situation and the course for the largest part of the real economy in Greece.

As in the surveys before, there is a clear record of economic climate trends as well as monitoring of the key indicators that have to do with small enterprises’ activity during the 1st half of 2014, while, at the same time, an economic outlook for the 2nd half of 2014.

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