Energy prices and labor costs
Energy prices and labor costs are the main barriers to running a business – according to research conducted in PIE as part of the Monthly Business Cycle Index (MIK). “Although from the beginning of 2022 to mid-2023 energy prices “Although these inconveniences were more of a problem for entrepreneurs than employee costs, this inconvenience has clearly decreased this year,” the PIE pointed out. As reported, the average inconvenience assessment (on a 5-point scale) did not exceed level 4, and in the last reading in September it amounted to 3.5.
The cost of hiring an employee is the main barrier
PIE noted that in the opinion of entrepreneurs, from mid-2023 to the present employee costs more than energy prices made it difficult to run a business. “Employee costs are the most burdensome barrier to running a business in the opinion of construction and TSL companies (70 percent of respondents indicated a strong and very strong burden). Employee costs are also a strong burden for commercial enterprises (63 percent of respondents) and manufacturing companies (60 percent)” – it was indicated.
Medium and large enterprises
Among medium and large enterprises the burden of energy prices as a barrier to running a business is most visible among service companies (60 percent of respondents indicated strong and very strong nuisance) and manufacturing companies (53 percent). Energy prices are very burdensome for half of the surveyed companies from the TSL sector.
“However, in trade and construction, less than half (47%) of companies indicate that business activity is significantly hindered by energy prices. For comparison, among medium and large enterprises, the burden of employee costs as a barrier to doing business is perceived more strongly than the burden of energy prices by enterprises from almost all sectors,” PIE noted. The exception are service companies, of which fewer (47%) indicated a strong and very strong burden of employment costs than the burden of energy prices.
“The decrease in the share of energy consumption costs in the total costs of enterprises is a consequence of, among others, the increase in the share of wages (by 2.0 percentage points), external services (by 1.7 percentage points), social security and other benefits and other costs by type (by 0.6 percentage points each) and the decrease in the share of material consumption (by 5.2 percentage points)” – summed up PIE. (PAP)
