Horror show on Spanish economy as HALF of all businesses don’t last THREE years | World | News

“There is a lack of entrepreneurs” is a phrase often repeated in Spain. However, according to the Spanish association of small and medium enterprises Cepyme “there is no problem with entrepreneurship”.

Spain creates 10.6% of the business fabric per year, above the EU average of 9.8%, according to the association.

He says the problem is not creating businesses but keeping them alive.

Cepyme said: “This trend is more acute in Spain in newly created companies, which are more vulnerable than in other European countries.”

In Spain, only half of companies survive three years after their creation, “a lower proportion than in the United Kingdom, Germany, France, Italy and Portugal, among other European countries”.

According to the Cepyme study, 9.2% of companies with employees end up closing in Spain every year.

He added: “This means that every year, one in 11 companies with employees in our country disappears, a trend that was already observed before the coronavirus crisis and which has worsened due to the pandemic.”

READ MORE: Rishi Sunak admits ‘global challenges’ await him

One of the main causes preventing Spanish companies from surviving, according to the Cepyme report, is the more than 100 regulations that “discourage” companies from growing in size.

The association said: “These barriers (fiscal, accounting, social, financial and competitive) are becoming a burden on the competitiveness of companies, hampering the recovery of the economy, job creation and the sustainability of public administration accounts. themselves in the long run.”

Cepyme estimates that Spain would create 1.2 million jobs and grow 5.2% more if measures leading to greater business growth were implemented.

Beyond the survival of the entrepreneurial fabric, the consequences are disastrous in terms of turnover and employment, and leave Spain below the European average.

Boris hit by new £1.7m consultant row as Tories slump in FOUR polls [POLL]
Covid origin mystery unveils ‘much wider distribution’ [REVEAL]
Kate Middleton is “much more confident” than Princess Diana was [ANALYSIS]

While the average Spanish company has a turnover of more than 1.1 million euros per year, the European average is 1.4 million, almost a third more, reports ABC.es.

Spain lags even further behind countries like Germany and Ireland, where company turnover reaches up to three million.

And with employment, it’s practically the same: while an average Spanish company employs 4.7 people, a company in the European Union employs 6.

This is without comparison with countries such as Germany, the United Kingdom and Austria, where the average size of companies doubles that of Spain.

This information adds to concerns about the characteristics of the Spanish business ecosystem.

The report adds: “SMEs are financed at higher interest rates and have fewer opportunities to attract talent or innovate, characteristics that lead small businesses to have less resilience to crises and a longer lifespan. shorter life”.

Between 2007 and 2013, small and medium enterprises lost half of the total employment lost during the construction crisis.

Now, in the midst of the COVID-19 crisis, the consequences can be deadly similar.

Previous China-backed junta violence worsens Myanmar economy
Next Economy 2021 a disruptive year for the global economy