Wage indexations and the skyrocketing energy prices are driving small and medium-sized enterprises (SMEs) in Belgium to take various money-saving measures, a recent survey by HR services provider SD Worx has revealed.
In the first quarter of 2022, the EU economy grew significantly following the Covid-19 pandemic, and many companies in various sectors started showing signs of recovery. Now, in the run-up to the final quarter, small and medium-sized companies in Belgium are once again finding themselves in a strenuous position.
"Personnel costs, together with energy costs, are the main priorities for the fourth quarter," Anneleen Verstraeten, SD Worx SME legal advisor, said, referring to the fact that these are the most popular aspects where companies are looking to save money.
Specific furlough scheme
Among SMEs, the wage costs increase is the biggest challenge in the final months of this year. The survey showed that, when budgeting for next year, almost all companies are taking into account that their employees wages will increase by at least 10%.
Other companies are facing additional costs, such as in the Industry and Construction sectors, where the rise in raw material prices and issues regarding the delivery of some materials are causing headaches.
In these sectors, one in five SMEs wants to invoke one of the forms of temporary unemployment energy, a scheme which will come into effect on 1 October. The scheme should help SMEs temporarily cut production "to bridge this challenging period" without losing their employees.
However, this solution is not possible for all companies, the survey highlighted, as one in six companies in these sectors is considering staff layoffs to save costs. Overall, one in five SMEs (19.8%) is replacing fewer or no employees when they leave the company.
Energy-saving measures
One in three SMEs are considering energy-saving measures this autumn and winter, as prices of both electricity and gas remain high. To cut costs of bills, lowering the temperature in the office building (44% of SMEs are taking this step) is the most popular step that is being taken.
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Meanwhile, some companies are reducing the number of locations or moving offices, while others are placing solar panels on their roofs. A shift to telework – to reduce commuting expenses – is also being considered, however, the number of companies doing this is limited.
"Reducing the temperature is the absolute no-brainer this autumn and winter. For next year, a bonus plan with energy targets could be interesting though; not many SMEs are doing this now," Verstraeten said.
