It seems obvious today that there is a symbiotic relation between national health and the economy. What is less immediately obvious is that anxiety is causing as much harm to our businesses as the coronavirus itself.
The economic fallout from Covid-19 is not only taking a toll on the finances of companies but on the mental wellbeing of entrepreneurs as well. In fact, the Chamber of SMEs discovered that seven out of ten of its members admit that the crisis situation is having a medium-to-high impact on their mental health, a rate higher than the 72 percent registered among their employees whose livelihoods are more at risk.
By their own accounts, entrepreneurs feel stuck on a train that has dangerously derailed. Nearly 80 percent of them cannot see their business in existence beyond three months, while far less than a third are contemplating proactive changes such as shifting to alternative offerings or investing in the digital space. This is a worrying scenario because the country relies on the creativity and energy that SMEs have the potential for.
Malta’s SME community accounts to more than four-fifths of the islands’ value added coming from the non-financial business sector, the highest rate in the EU. This is perhaps not entirely surprising given that 99 percent of businesses here are SMEs.
However, when 97 out of every 100 companies are micro enterprises employing 10 people or less, the power of individual resourcefulness, ingenuity and expedience comes into full view. Our workforce is, almost at once, our entrepreneurial base and the economy needs all the business acumen it can gather to steer itself out of the crisis.
Instead, company owners find themselves consumed by fears over payroll or rental dues and utility arrears when they should be focusing on stabilisation and rebuild. Entrepreneurs must find the comfort and tangible support that gives them the confidence to carve out new paths.
Apart from urgent financial aid, entrepreneurs need to have access to practical help such as expert advice and guidance on matters of operability, accountancy, employment law and EU business schemes.
The country must act firmly to reassure SMEs before they can start turning the national economic situation around. Businesses thrive in challenging situations, but uncertainty poisons all initiative. If we are still sailing through the unknown, it is because we have not yet started to create our future.