Business Climate for Solo Self-Employed Persons and Microenterprises Plummets
The business climate for microenterprises and solo self-employed persons in Germany has plummeted, according to the latest index for this segment (“Jimdo-ifo Business Climate Index”). This index fell to minus 10.0 points (not seasonally adjusted) in March, down from plus 2.6 points in February. “The burgeoning optimism of February collapsed as a result of Russia’s attack on Ukraine,” says Klaus Wohlrabe, Head of Surveys at ifo. “This uncertainty is also rampant among microenterprises and solo self-employed persons,” he adds.
The sharp downturn in the business climate is due to a slump in expectations. However, companies’ assessment of their current situation was slightly better in March.
More and more companies in Germany have announced price increases, and microenterprises and solo self-employed persons are no exception. One in two companies reported that they were planning to raise prices. This puts them not far behind the level of the economy overall, where the proportion is almost two-thirds.
The ifo Institute has been publishing the Jimdo-ifo Business Climate Index for solo self-employed persons and microenterprises (fewer than nine employees) since August 2021. As in the composite index, all sectors of the economy are taken into account. However, its main focus is the service sector. New participants are won in collaboration with Jimdo, a provider of online tools specially geared toward the solo self-employed and small businesses.
