2023-07-21 11:16:54
Business business figures have gone from reflecting a false bonanza that was the result of its normalization, after the extremely complicated situation experienced during 2020 and 2021, to pointing to a sharp slowdown that is consistent with a significant slowdown that the economy has been registering since the second half of 2022.
CEPYME views with concern the drop registered by the General Business Turnover Index for the second consecutive month, which presented an annual variation of -2.7% in May, at a seasonally adjusted rate, and -2.5%, at the original rate.
When the activity and the figures of the companies return to the starting point of the end of 2019, data such as the turnover reveal a clear weakness that will worsen in the coming months as a result of the tightening of the ECB’s monetary policy that puts a brake on activity. In this sense, it should be remembered that, in the first half of 2020, Spain’s GDP fell by -13.4% and it has not recovered its pre-pandemic figures until the first quarter of 2023.
Source: INE
By sectors
The deterioration in the turnover of the commerce sector stands out, in line with the fall in household final consumption expenditure in the final part of 2022 and the beginning of 2023. A sector where the presence of SMEs is predominant and which adds up the largest number of companies in Spain. In fact, the figures shown are in line with a scenario in which the SME contributes to containing inflation so as not to lose customers, despite the fact that their accounts are greatly affected by cost increases. According to the result of the latest CEPYME Barometer published this week, 80% of SMEs have not fully transferred the increase in their costs to prices, given the fear that their demand will fall.
In parallel, the situation of the industry is quite complex in a scenario in which its demand does not quite respond. CEPYME draws attention to the sluggishness of the industry’s turnover and warns that it will continue in the coming months, as can be seen in the leading indicators that indicate that the decline in new orders is accelerating and its backlog is weakening. For the Confederation, these data show the need to firmly support a strategic sector for the economy as a whole.
On the other hand, it is worth highlighting the better performance of services, benefited by the boost given by international tourism, although the growth path of its turnover marks a clear slowdown in a context of significant cost increases.
Bearing in mind that the survey includes “the turnover of a company, in monetary terms, due to the sale of goods and provision of services to third parties”, according to the INE’s definition of turnover, it can be seen that the statistic is quite impacted by the effect of prices and this explains why the sector of electricity supply and water, sanitation and waste management is the one that registers the worst performance (-25.3% year-on-year and -5.4% month-on-month) in the shadow of some normalization of electricity prices. electricity and gas that conditions the whole of the statistics downwards.
Curb costs and move towards reforms and better taxation
Normalization has been confused with bonanza in terms of the economy and, from CEPYME, it is warned that business accounts cannot be used as an alibi to tax the company more, raising its costs, while the regulatory framework has continued to become more complex and detrimental to the activity.
For this reason, in scenarios like the current one, CEPYME affirms that the best revulsive are the structural reforms that boost potential growth and benefit business growth.
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