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The financial situation of businesses has deteriorated at the start of the year, marking the weakest economic position in recent years, according to a new Entrepreneur Survey. Only 52% of small and medium-sized enterprises (SMEs) described their financial situation as very good or fairly good in February, a decrease from 55% in December. Conversely, 17% of respondents now view their economic standing as fairly or very poor, indicating a challenging situation for approximately 75,000 businesses.

The survey, which gathered opinions from 1,339 representatives of SMEs in February, highlighted a noticeable shift towards a weaker economic state for businesses, particularly in the retail sector where 22% reported a fairly or very poor situation. This downturn comes as businesses face additional pressures, including the impact of professional union strikes, as noted by Mikael Pentikäinen, CEO of the Finnish Entrepreneurs.

Pentikäinen expressed concern over the lack of understanding in Finland regarding the severity of the situation and the unsustainable nature of living on debt without undergoing necessary reforms. "We must have the courage to implement structural reforms to get Finland's economy growing again," he emphasized.

The outlook for the near future also appears grim, with 22% of entrepreneurs predicting a significant or slight deterioration in their business's financial situation over the next year. This sentiment is particularly stark in the construction sector, where 32% anticipate a worsening scenario.

Highlighting the challenges to economic growth, Pentikäinen pointed out the diminishing desire and opportunities for businesses to expand, evidenced by reduced investments and a continuous decline in the proportion of growth-oriented companies. "I understand entrepreneurs who, in this labor market climate, consider whether it might be better to close up shop or relocate," Pentikäinen remarked, underscoring the urgency for action to foster a conducive environment for business growth and development.

HT

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