[WATCH] Biggest concern for SMEs is employee wages, chamber survey finds

Almost a third of businesses have identified employee wages as their biggest concern, according to the findings of a survey carried out by the Chamber for Small and Medium Enterprises.

The results released this afternoon show that 31% of businesses cited employee wages as their biggest concern, while 24% said that collecting payments due was the issue troubling them the most.

The survey titled The Continued Effect of the COVID-19 Pandemic in Malta, targeted 360 respondents, and tried to understand how small businesses were coping with the situation created by the pandemic.

In the survey, rent and banking issues also featured among the biggest concerns for businesses.

Asked how long they feel that they can cope with the ongoing situation, 30% of businesses said for up to two months, while 29% said for up to three months. 

Another 5% said that they can only make it through the next two weeks, while 17% said they could sustain the current situation for up to one month. Only 19% felt they can go beyond three months.

72% of respondents said they had not started laying off employees, while 12% said they already had made workers redundant. The remaining 16% consist mainly of self-employed businesses.

Of the 12% who said they made workers redundant, 10% laid off only 5% of their workforce, while 25% said they laid off only 4% of employees. The rest said they only laid off 1% of their workforce. 

Participants were also asked to rate the level of government support on a scale of 1 (lowest) to 5 (highest).

The absolute majority (54%) rated government support at its lowest level (1 and 2), while a third gave a middle rating (3). The rest (12%) rated government support at the top scores (4 and 5).

Asked if their business can sustain the wage top-up over and above government’s subsidy, 57% said no, while 43% said yes.

The survey also delved into the mental health of business owners, with the study asking respondents to rate the effect of COVID-19 on their mental health on a scale of 1 (no effect) to 5 (very adverse effect).

The majority, at 32%, rated the effect on their mental health as 3, while 24% rated it at 4. An impressive 18% said the pandemic had effected their mental health very adversely.

Commercial rents were another worry with 31% of business owners saying that the level of understanding by landlords was at its lowest. 25% of respondents also said that institutional help was necessary since an agreement between both parties could not be reached.

Looking ahead, the survey also asked what decisions will be taken by businesses until the end of the month, with 32% saying that they will continue as is.

However, 29% said that they will remain closed, or will temporarily close down, 18% said they would start making employees redundant, 11% said they would be investing in e-commerce and online marketing. 6% said they were changing the services offered, while 9% cited other plans.

Only 2% said they will be investing in new business, while 2% will be declaring bankruptcy.

Asked if the chamber has a time-frame for when restrictions will be lifted, SME Chamber CEO, Abigail Mamo said the chamber is prepared for all eventualities.

“Our work is to obey the direction by health authorities, and make sure that we are ready once restrictions are lifted,” Mamo said.