Companies emerging from lockdown well, finds new report
The economic situation surrounding Polish companies is showing signs of improvement as the economy defrosts and the effects of the government’s anti-crisis shield kicks in, a report has found.
New research by the Polish Economic Institute (PIE) has found that despite the pandemic crisis the situation for many companies has improved since March although it remains far from perfect as they struggle with falling income and orders.
“The defrosting of the economy of the economy has resulted in changes to the situation on the labour market,” said Andrzej Kubisiak, deputy director of research and analysis at PIE, in the report.
He added: “After the slowdown we are beginning to observe a systematic decrease in the number of companies planning to reduce their levels of employment. At the end of March, 28 percent of companies were planning to do this but now that number has fallen to 8.
“Of equal importance is the number of employers contemplating a reduction in salaries,” he added. “Now 66 percent plan to keep salaries at the same level. That is 30 percent more than at the end of March.”
The report also found that at the end of March 71 percent of the companies surveyed reported a decrease in orders, but that number has now fallen to 41 percent. Another positive sign was that at the end of May the number of companies experiencing falling sales decreased from 67 percent to 49 percent.
The crisis has exposed, in particular, the vulnerability of small companies because they have little in the way of financial reserves to protect them from the economic storm.
But here, the PIE report finds, the Anti-Crisis Shield has thrown them a much needed lifeline.
Some 89 percent of companies that lack the cash to survive even a month have benefited from the shield, while 76 percent of those that have reserves for a month have also tapped into the shield.
Director of PIE, Piotr Arak said: “Our research shows the financial support available during the crisis is used by groups of companies that have the lowest financial reserves.
“This is a good sign because it shows that the money designated to save the Polish economy is being targeted at where the need is greatest.”