Entrepreneurs need support in uncertain times
/ Blog
I have been reading the financial news with a heavy heart. The number of bankruptcies has risen and the number of employed people has begun to decline. Behind the figures published by research institutes are people – our customers.
The current economic difficulties are also evident here at Elo. Amongst our TyEL employee pension insurance customers, the number of bankruptcies has increased by 46% this year. The number of payment plans we prepared increased by 56% compared to January–July last year. There are problems particularly in the construction sector and the hotel and restaurant industry, but the knock-on effects of payment difficulties are felt by many different industries. While credit losses in terms of euros are still at a very moderate level, the current trend gives cause for concern.
Payment difficulties add to the burden of entrepreneurs, who already have a lot on their plate to begin with. According to a survey by Suomen Yrittäjät, half of all entrepreneurs in Finland took no more than two weeks off last summer. Not much is known about entrepreneurs’ ability to cope with the demands of working and running a business, while the work ability of wage-earners is heavily invested in and actively studied. I believe that the reason for this is largely structural. The number of sole entrepreneurs has increased sharply over a relatively short period of time. In 2010, there were just over 150,000 sole entrepreneurs in Finland. Their number is now approaching 200,000. It is fair to say that this is one of the largest structural changes in the last couple of decades.
In my opinion, it is clear that we as a society have not paid enough attention to sole entrepreneurs’ and small-scale entrepreneurs’ ability to cope with the demands of entrepreneurship. Our understanding of the social security and unemployment security of entrepreneurs is also insufficient. This is the opposite of how things should be, as people in this group are the first to feel the impact of declining economic conditions, and they are also hit the hardest.
In times of uncertainty, entrepreneurs rely on other people for support. According to a survey of sole entrepreneurs by Suomen Yrittäjät (2022), most sole entrepreneurs conduct their business in networks with other entrepreneurs. In times like these, it is a good idea to stay engaged with various networks and sparring groups and to seek help from others.
The support of partners and service providers is also worth keeping in mind. At Elo, we encourage entrepreneurs to contact us as soon as any potential problems are in sight. If an entrepreneur has even the slightest suspicion that they will not be able to make their payments, they should take action rather than wait. From our perspective, it is always easier and better to manage such situations proactively. That gives us the best chance of finding the best possible solution together with the customer.
The current economic difficulties are also evident here at Elo. Amongst our TyEL employee pension insurance customers, the number of bankruptcies has increased by 46% this year. The number of payment plans we prepared increased by 56% compared to January–July last year. There are problems particularly in the construction sector and the hotel and restaurant industry, but the knock-on effects of payment difficulties are felt by many different industries. While credit losses in terms of euros are still at a very moderate level, the current trend gives cause for concern.
Payment difficulties add to the burden of entrepreneurs, who already have a lot on their plate to begin with. According to a survey by Suomen Yrittäjät, half of all entrepreneurs in Finland took no more than two weeks off last summer. Not much is known about entrepreneurs’ ability to cope with the demands of working and running a business, while the work ability of wage-earners is heavily invested in and actively studied. I believe that the reason for this is largely structural. The number of sole entrepreneurs has increased sharply over a relatively short period of time. In 2010, there were just over 150,000 sole entrepreneurs in Finland. Their number is now approaching 200,000. It is fair to say that this is one of the largest structural changes in the last couple of decades.
In my opinion, it is clear that we as a society have not paid enough attention to sole entrepreneurs’ and small-scale entrepreneurs’ ability to cope with the demands of entrepreneurship. Our understanding of the social security and unemployment security of entrepreneurs is also insufficient. This is the opposite of how things should be, as people in this group are the first to feel the impact of declining economic conditions, and they are also hit the hardest.
In times of uncertainty, entrepreneurs rely on other people for support. According to a survey of sole entrepreneurs by Suomen Yrittäjät (2022), most sole entrepreneurs conduct their business in networks with other entrepreneurs. In times like these, it is a good idea to stay engaged with various networks and sparring groups and to seek help from others.
The support of partners and service providers is also worth keeping in mind. At Elo, we encourage entrepreneurs to contact us as soon as any potential problems are in sight. If an entrepreneur has even the slightest suspicion that they will not be able to make their payments, they should take action rather than wait. From our perspective, it is always easier and better to manage such situations proactively. That gives us the best chance of finding the best possible solution together with the customer.
KEYWORDS
