One in three small businesses in Brussels faces severe financial problems
Friday, 12 March 2021
A year into the coronavirus crisis, one in three small businesses in the Belgian capital is currently experiencing severe financial problems, along with one in five self-employed persons.
This means that their cash reserves are empty, according to a study by Unizo, an organisation for the self-employed, and Graydon, a consultancy firm.
“The report shows that the Brussels support measures have had less impact than the Flemish ones,” Anton Van Assche of Unizo told Bruzz. “The continuation of the support measures, certainly and especially for those companies and sectors that are currently still at a standstill or running at a fraction of their normal level, remains vital for the many entrepreneurs in these sectors.”
For effective financial support, the amount of money needed is high.
The study estimated that self-employed people facing financial difficulties together need about €3.6 billion in capital injections. For the small businesses, the amount is €7.9 billion, for a total of €11.5 billion.
The organisations investigated the impact of the coronavirus pandemic on Brussels companies with up to 50 employees, which included 28,488 entrepreneurs and 78,000 full-time jobs in the Brussels region.
They discovered that 19.5% of the self-employed and 36.6% of the small businesses are facing depleted cash reserves and are in dire need of an injection of capital.
Entrepreneurs in the north-east of Brussels (Jette, Berchem-Sainte-Agathe, and Koekelberg) had the most difficult year, according to the study. In those municipalities, more than a quarter of the businesses are experiencing major financial difficulties right now.
When it comes to companies that were in good financial health before the pandemic hit, a sixth of the self-employed and a quarter of small businesses are now experiencing major difficulties.
The study says the situation would have been far worse for those groups without the federal support measures that have already been enacted, predicting it would be 21.2% of the self-employed and 35.5% of small businesses facing a financial crisis.
The Brussels government announced additional support measures for the hospitality, tourism, and events sectors this week.