VSEs and SMEs, hailed for their resilience in 2022, are expecting a difficult 2023. Many companies have already announced a temporary halt to production, and fear that the situation will worsen over the coming months. What difficulties can they expect?
Soaring energy prices
The introduction of a gas and electricity tariff shield for very small businesses with fewer than 10 employees, and the launch of an electricity shock absorber for SMEs with fewer than 250 employees and sales of €50 million, are no longer enough.
According to the French Confederation of Small and Medium-sized Enterprises (CPME), nearly 9% of small and medium-sized businesses in all sectors fear they may have to close their operations because of soaring energy prices.
Some 400 large industrial groups have applied to the Comité interministériel de restructuration industriel (CIRI), the French interministerial committee for industrial restructuring, whose remit is to help companies in difficulty.
Although all sectors are affected, the food industry, which is in the midst of trade negotiations, is particularly dreading the weeks ahead.
Debt repayment and PGE
Between March 2020 and June 2022, nearly 700,000 state-guaranteed loans were granted by banks for a total of over 143 billion euros. These loans enabled companies to maintain their activity during the Covid-19 pandemic and replenish their cash flow on advantageous terms.
According to Philippe Brassac, Chairman of the French Banking Federation (FBF), " around 25% of the capital amounts have been repaid ".
However, concern is growing among very small businesses. The Bpifrance, Le Lab, and Rexecode barometer published last November reported that 9% of these companies thought they would not be able to repay their debt, a proportion up 2 points on the previous survey on the subject.
These fears about EMP are accompanied by a deterioration in corporate cash flow over the coming weeks, against a backdrop of energy crisis and probable recession.
Pressure on wages
In response to rising prices, the index point for civil servants was raised by 3.5% last July. In the private sector, in Q3 2022, basic monthly wages rose by an average of 3.7% year-on-year, according to the Ministry of Labor's research department (Dares). This marks an acceleration of 0.6 points compared with the previous three months.
These increases are not enough to keep pace with inflation, which stood at 5.9% year-on-year. In fact, wages are rising more slowly than prices. This is putting a strain on company directors, whose mandatory annual negotiations are about to begin. According to a survey conducted by Alixio at the end of the year, two-thirds of companies surveyed were planning to increase their employees by around 4.3% in 2023.
[PRESS]- Alixio (@AlixioConseil) December 8, 2022
📢 The results of our latest major "Inflation & Salaries" survey in #leParisien on 07/12.
✔ 95% of companies surveyed forecast a salary increase budget of over 3%, with an average of 4.5%#salaries #inflation #dialoguesocial pic.twitter.com/3jkGvIGKKJ