The federation's chief economist, Juhana Brotherus, said the financial situation of businesses is still assessed slightly worse than in May of last year. The easing of the energy crisis seems to alleviate the concerns of small and medium-sized enterprises, but at the same time, increasing interest rates are being felt in many businesses.
The average financial situation in thesurveyed companies was either very or fairly good, according to the survey. A further 29% judged it to be neither good nor bad, while 17% said it was fairly or very poor. The situation was best for companies employing more than ten people and weakest for single-person businesses.
Businesses have been impacted by the inflation rate, with many companies raising their prices. However, not all companies are able to pass on their increased costs to customers, leading to 44% of businesses experiencing a drop in profitability. This trend has been exacerbated by rising interest rates, particularly for small and medium-sized companies, as around 40% of them have outstanding debt.
Brotherus observes that delayed and cancellation of investments due to inflationary pressures are a worrying possibility for the future growth of the Finnish economy. The inflation rate has caused companies with more than ten employees to discontinue growth investments.
Employers who are also entrepreneurs have increased their pay, which is because of a general shortage of workers and the current collective bargaining in Finland.
Brotherus states that the needs of small and medium-sized enterprises can be summarized as growth, incentives, and a stable public economy. The ability of the upcoming government to meet these needs will be instrumental in raising entrepreneurial expectations for desirable reforms.
Entrepreneurs are always concerned with the risk of making the wrong recruitment decision, with the fear of making the wrong hiring decision being a major concern. To ensure that more small and medium-sized entrepreneurs are confident enough to recruit additional assistance without the threat of excessive harm to their business, it is essential to reduce the risk of hiring.
The results of Yritt j gallup survey highlights the challenges facing Finnish businesses. The global economy's instability, as well as inflationary pressures and rising interest rates, have resulted in poor business performance. Finland's entrepreneurs are now looking to the government for policies that support growth and encourage small and medium-sized enterprises to maintain a stable public economy.