Business has chosen a waiting tactic
InfoCredit Microenterprise Index
In February 2021, 21.3 thousand businesses were established, 13.6 thousand were closed. Almost 10 thousand were resumed and 18.2 thousand were suspended. In the same period last year, the figures were 23.4 thousand (new), 13.1 (closed), 11.7 (resumed) and 19 thousand (suspended), respectively – according to CEDIG data.
The advantage of suspending over unsuspending in February 2021 continues to fall. The InfoCredit index increased from -15,816 points after January to -8,197 points currently. There were 7,678 more new businesses than those closed. This means another monthly increase in the index describing the ratio of new to completed businesses from 6,093 points after January and from 1,306 points in December 2020.
There would be nothing alarming in the February data, if not for the fact that fewer and fewer applications are being submitted to CEIDG (excluding those for minor changes in entries). In February 2021, CEIDG received a total of 63,000 of them, compared to 67.2 thousand a year earlier. So there are still not only fewer new and suspended businesses, but also fewer closed and suspended businesses.
Business has dug in and is waiting for better times. This applies not only to small businesses, but also to companies registered in the National Court Register. This is clearly visible in the year-on-year comparison. All the more so because February 2020, as a reference point, was the last month of relative “normality” and fairly good economic conditions before the outbreak of the epidemic. What next? Of course, it depends on how the situation develops, further restrictions and consumer sentiment.
The number of applications submitted to CEIDG is decreasing month by month. A similar phenomenon is beginning to be visible in the REGON register, where in February the number of newly registered entities dropped by 5.5% to 27,126 counted m/m (GUS data). When it comes to business entities, this trend was already visible last year. In 2020, 311.8 thousand entities were registered, compared to 355.8 in 2019. In the second quarter of 2020, when the epidemic was gaining momentum, 64.4 thousand were registered. entities compared to 94.4 in the same period of 2019. In the fourth quarter, when it was gaining momentum again, 75.9 thousand were registered, compared to 78.3 thousand a year earlier.
Interestingly, the number of bankruptcies is also falling significantly.
– This means that Polish business is falling into a state of lethargy. We have already become accustomed to the fact that the situation is changing rapidly and new decisions have to be made from day to day. We are not sure whether tomorrow will bring tightening or easing of restrictions. This is not conducive to bold decisions and registration of new businesses. And this is both in the form of activity, which is very flexible, but also in opening new commercial law entities. There are, of course, industries that have benefited from the technological revolution and the increasing interpenetration of real and virtual reality. But there are also those that are in lethargy. By accepting help, they cannot go bankrupt – says Jerzy Wonka, Development Director at InfoCredit.
In January, 24 companies declared bankruptcy. This is 19% less month-on-month and as much as 45% less year-on-year. In the fourth quarter of 2020, 106 business entities went bankrupt, compared to 159 in the same period a year earlier. In all of 2020, 528 entities went bankrupt, compared to 578 the previous year.
How do we calculate the InfoCredit Index?
The InfoCredit Index was created to track trends in micro-entrepreneurship, alternative forms of employment and self-employment at a time when the situation on the labor market is changing dynamically. The index, which is developed by the oldest company in Poland analyzing the economy, takes on a positive value when there are more new businesses than closures. When there are fewer than closed ones – a negative value. In the same way, we track the ratio of resumed to suspended businesses.
