VSE-SMEs expect a general slowdown in 2024.

Bpifrance Le Lab’s 79th half-yearly survey, based on feedback from more than 5,000 businesses, reveals an anticipated slowdown in business activity for VSEs and SMEs in 2024, down 10 points year-on-year, well below its long-term average (+14). SMEs with at least 100 employees expect their sales to increase by 2.0%, while VSEs anticipate a decline of 2.5%.

Services are doing well, while other sectors are struggling.

Services is the only sector where positive sales growth is forecast. By contrast, the Transport, Trade and Construction sectors are expected to record declines ranging from -1% to -3%. Industry should see stable sales, while the Tourism sector is returning to more  moderate growth after a post-Covid recovery.

A stable cash position and continued access to credit for businesses.

The cash position of VSEs and SMEs has stabilised, remaining generally favourable compared with previous years. Access to investment credit remains favourable and eased slightly at the start of the year. However, the high cost of credit and weak demand continue to weigh on investment, particularly in green projects.

Employment remains robust despite persistent recruitment challenges

The employment outlook is relatively resilient, with a balance of opinion of +9, close to the long-term average (+8). Recruitment difficulties remain high but are less severe than at the end of 2023: 78% of managers say they are encountering difficulties, but fewer consider them to be severe (34%).

The economic climate is putting the brakes on investment, including green initiatives.

Investment is slowing for 2024, affected by high interest rates and weakening demand. Investment intentions are down slightly, with 43% of VSEs having made or planning to make investments, compared with 45% the previous year. Green investment continues to decline, with only 28% of businesses having made such investments in 2023.

Encouraging signs despite a generally gloomy environment.

Despite a slowdown in activity and low order books, not all indicators are on alert. Cash flow remains comfortable on average, access to credit is easy, and employment is holding up well, despite past rate rises. The outlook for 2025 varies according to sector, with positive momentum expected in Services and Industry, in contrast to Construction, Trade, Transport and even Tourism, where sentiment remains low.

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