Younger companies cope better with crisis
Younger enterprises appear to have more sales and greater resistance to the financial crisis than those that are 10 years old or more, due to the accumulated problems and obligations that older companies tend to be burdened with, such as higher rents and amassed debts, along with obsolete practices. Newer companies created during the crisis, in contrast, may have limited access to funding but have smaller rent labor costs, and are also spared the burden of previous debts.
These findings emerged from the latest survey conducted by the Small Enterprises’ Institute of the Hellenic Confederation of Professionals, Craftsmen and Merchants (IME GSEVEE), presented earlier this week. There certainly are several exceptions of older companies that are thriving and newer ones suffering.
According to the survey, more than one in five (23.5 percent) companies aged up to five years reported an increase in turnover in the first half of the year, with that rate being far lower for older firms. Fewer young companies had to slash their employees’ salaries (19.3 percent) in the year to end-June, against 28.1 percent among companies aged between five and 10 years, and 24.2 percent for firms aged over 10 years.
In any case, the findings go against the government’s narrative about a rebound in the economy, as they point to some 18,100 shutdowns in the market in the second half of the year. This, according to the institute’s calculations, means the loss of 33,000 jobs, including salaried workers, employers and the self-employed.
