Very small businesses say they are ready to raise wages

According to the latest Bpifrance Le Lab and Rexecode barometer, recruitment difficulties are the number one obstacle to growth for VSEs and SMEs, ahead of price rises and supply problems. A majority of these companies say they are ready to raise wages to retain their employees or preserve their purchasing power.

Recruitment difficulties, the main obstacle to growth for VSEs and SMEs

VSEs and SMEs face a number of obstacles: soaring gas and electricity prices, rising costs and supply difficulties are all affecting their cash flow and hampering their growth.

The latest projections from the Banque de France point to a possible recession, with growth in 2023 ranging from +0.8% to -0.5%, and inflation likely to reach 6.9%.

However, the main concern of VSE and SME managers is quite different: recruitment difficulties are seen by 60% of them as the main obstacle to the growth of their companies, an increase of 4 points over the quarter, according to the latest Bpifrance Le Lab and Rexecode barometer.

Considered the second biggest obstacle to growth by 41% of VSEs and SMEs, price rises are only a distant second to recruitment difficulties, although they have risen by 20 points over the past year.

Wage increases for 61% of small businesses

Recruitment difficulties are affecting many sectors, from industry to transport and construction. A shortage of skilled workers, the arduous nature of the work involved, greater employee mobility since the start of the Covid-19 pandemic: these are just some of the factors that are prompting the managers of small and medium-sized businesses to try and find solutions.

Among the avenues being pursued, many companies are focusing on salary increases. In 2022, according to the Bpifrance Le Lab and Rexecode Barometer, 61% of VSE-SME managers plan to implement or have already implemented pay rises, up 6 points on April and 11 points on February.

For 70% of the VSEs concerned, the primary aim of these salary increases is to retain employees, while for 62% of them, the aim is to preserve employees' purchasing power. Including those companies not planning to increase salaries, the average increase is expected to be 3.1%.