Micro-entrepreneurs Under Pressure
JDG InfoCredit Index
- In Q3 2024, 103.3 thousand businesses were suspended. This is 6718 more than in the same period of 2023, which was already record-low.
- In Q3 2024, Poles also started fewer businesses than last year and closed more.
- The InfoCredit Business Activity Index in quarterly terms after September has never been so low. In monthly terms as well.
- If Q4 of this year is as weak for businesses as last year, another record of weakness in the statistics of sole proprietorships will be broken.
From January to September 2024, 221.4 thousand sole proprietorships (SMEs) were started in Poland, 149.4 thousand were resumed, 282.4 thousand were suspended and 141.9 thousand were closed. In total, there were as many as 53.5 thousand more suspended and closed businesses. A year ago, this advantage was smaller (there were 43.5 thousand more suspended and closed businesses).
This is the effect of the weak third quarter and September of this year. We recorded 149.5 thousand established and closed businesses compared to 117.4 thousand new and renewed businesses. The InfoCredit index calculated quarterly fell to -32,067 points compared to -19,680 a year earlier. Our monthly indicator dropped to -7,566 points compared to -3,072 points a year earlier. The InfoCredit index has not been this low at this time since we started counting it.
Costs, costs, costs…
There is no indication that this trend will reverse in the fourth quarter. The advantage of suspended and closed JDGs has been growing practically from quarter to quarter for years. Similarly to the costs of running a business in Poland. The milestone was the announcement of the Polish deal. It started with a slump at the end of 2021, when we noted a significant increase in the number of businesses being closed and suspended, because entrepreneurs did not like the mess and ambiguity associated with the Polish Deal. And then the trend only accelerated, along with inflation and the increasing burdens on entrepreneurs.
Seasonality will hit the statistics
In January, we warned that in 2023, 372.5 thousand businesses were suspended (a record) and 198.2 thousand businesses were closed (the most since 2014). These records may be broken again. In Q4, we have been recording the most suspended and closed businesses for years. Last year, 102.5 thousand self-employed entities were suspended during this period (compared to 97.7 thousand in Q4 2022). In other words, about 100 thousand suspensions will be enough to break the record.
Micro-entrepreneurs will continue to be under pressure in the coming months. The ZUS holiday (applications can be submitted from November 1) will not change much. This is a one-time relief, once a year. In addition, not everyone will be able to take advantage of it. Small businesses are waiting primarily for changes in the rules for calculating health insurance contributions.
The retreat from the seaside continues
In September, the largest number of suspended businesses was still recorded in coastal municipalities. Small businesses closed the fastest, per 1,000 residents, in Jastarnia, Krynica Morska, Rewal, Łeba and Władysławowo. Why per 1,000? Because not every municipality is the same. It is difficult to compare, for example, Jastarnia, which has approx. 2,600 permanent residents, with Władysławowo (over 10,000) or Zakopane (27.3 thousand).
IC Index – ranking by municipality after September
|
Gmina |
Woj. |
Indeks IC w pkt |
Indeks IC |
|
Jastarnia |
pomorskie |
-372 |
-106,8 |
|
Krynica Morska |
pomorskie |
-96 |
-82,4 |
|
Rewal |
zach. |
-291 |
-81,0 |
|
Łeba |
pomorskie |
-229 |
-75,7 |
|
Władysławowo |
pomorskie |
-1073 |
-75,0 |
|
Dziwnów |
zach. |
-267 |
-75,0 |
|
Mielno |
zach. |
-262 |
-56,6 |
|
Ustronie Morskie |
zach. |
-204 |
-54,5 |
|
Międzyzdroje |
zach. |
-199 |
-33,0 |
|
Hel (miejska) |
pomorskie |
-79 |
-28,4 |
Let us recall – after June Jastarnia was the clear leader in terms of new and renewed JDG (after May it was in the lead). The index for this commune exceeded +50 points at that time, which meant that one business per 20 residents was established or suspended! Now – one business per 10 residents was suspended or closed! This shows that the greatest seasonality in JDG is recorded in typical tourist towns, most in seaside resorts. The top ten communes with the highest drop in the IC Index are only those from Pomerania and West Pomerania.
There are 2477 communes in Poland. We monitor all of them. Do you want to know what is happening in your province, district, commune? Contact us: infocredit@infocredit.pl or media@infocredit.pl. We invite you.
How do we calculate the InfoCredit business activity index
Our business activity index shows the ratio of new and resumed businesses to closed and suspended businesses. When the index is positive, it means that more businesses were established and re-established than were suspended and closed. The higher the index value, the greater the tendency to open small businesses. When the index indicates values below zero, it means a retreat from this form of business activity. The more the index is negative, the more small entrepreneurs withdraw from business (definitely or temporarily). We publish the index on a quarterly basis (after each quarter) and monthly basis. In the case of individual communes, we calculate the index value per 1,000 residents.