This is what emerges from a survey by the Chamber of Commerce. Tagliavanti: “Companies in the capital show great resilience”
2023 looks like a year of consolidation for companies in Rome and its province after the growth of 2022. About 6 companies out of 10 show an increasing or stable turnover, eight companies out of ten have kept the number of employees unchanged, while in one case out of ten there was an increase in the number of employees. The strong growth in the prices of energy goods and inflation in general has “forced” two out of 3 Roman companies to increase their prices in 2022, and two out of three companies have increased their prices also in these first 4 months of 2023.
This is what emerges from a survey by the Chamber of Commerce of Rome which built a panel of 500 companies representing the economic activities of Rome and its province for a constant update on the evolution of the economic situation. This new survey aims to investigate how companies are dealing with this phase and how the increase in financing costs is influencing the business strategies of companies in Rome and its province. The survey was conducted between 22 and 29 May 2023. In 67% of cases, the companies in the panel are based in the municipality of Rome and in 33% of cases in the rest of the province of Rome. 84.6% of enterprises have between 0 and 9 employees, 12.6% between 10 and 49 employees and 2.8% of enterprises have over 50 employees.
The increase in interest rates implemented by the ECB (European Central Bank) to counter inflation is starting to have a significant impact on the fabric of Roman businesses: almost 6 out of 10 companies have given up on investment projects due to the increase of financing costs, and for almost two out of three companies, access to credit will be a problem during the year.
In the first 4 months of 2023, for 56.9% of companies, turnover remained stable or increasing, while for 43.1%, however, turnover is decreasing. For 80.4% of the Roman companies in the sample, the number of employees remained stable, compared to a percentage of 9.3% which increased the number of employees and 10.2% which, instead, reduced them .
In 2022, mainly due to the rise in the prices of energy goods, 65.8% of the companies interviewed increased their prices, while 34.2% did not increase their price lists. Also in these first 4 months of 2023, due to the persistence of high inflation, 66.2% of companies raised their prices, against 33.8% which, on the other hand, did not increase their prices.
The increase in financing costs in the first 4 months of 2023 was reported by about three out of 4 companies, the increase in the cost of financing forced 59.1% of companies to abandon investment projects, this is probably the most worrying aspect observed in relation to the increase in interest rates. 56.4% of businesses also report a tightening of credit availability by banks and not just a higher cost of financing.
In total, for 64% of companies access to credit will be a problem in 2023. Within this 64% of companies, for about 30.7% access to credit is a problem similar to how it was already in 2022, for 33.3% of companies in 2023 access to credit will be a greater problem than in 2022. 36% of companies do not think that access to credit will be a problem for their company in 2023.
“Roman businesses -says Lorenzo Tagliavanti, president of the Rome Chamber of Commerce- show great resilience. Faced with the difficulties of the moment, they do not give up and try in every way to move forward. The aspect of turnover in the short term is a good sign and means that products made in Rome are still valid on the market. And, above all, given the increase in costs, companies have decided to keep employment stable”.
“It is obvious – he explains – that a large part of the increase in production costs is passed on to the final price even if this does not apply to the entire business world. Instead, the reduction in investments due to the increase in the cost of credit is very worrying and above all the difficulties in resorting to it”. “On this point, the institutions in charge – concludes Tagliavanti – should, together, make an extraordinary effort to meet the entrepreneurial fabric and facilitate in all possible ways both a lowering of rates and the use of credit itself”.