SMEs: size does matter

BarcelonaThis week, Pimec went to Madrid to defend a law that facilitates business growth. Antoni Cañete, the president of this Catalan employers' organization, is a man who is insistent and persistent in the defense of what he considers affects small and medium-sized enterprises. His phrase is a classic: "SMEs must be on the bridge of command," which means that these companies, which are the main component of the country's industrial and business fabric, must be present in all areas where the regulations and rules that affect them are decided. A sign of this is the constant demand for rules and measures aimed at combating late payments, an evil that stifles many companies, especially the smallest ones and, of course, the self-employed who work as suppliers for larger industries and companies.

In the crosshairs of this employers' association now is the size of companies, an essential factor for generating value and greater competitiveness. Pimec itself has produced a study that proves this with figures and data that it never tires of disseminating. It is not that there should not be large companies, but rather that all of them should gain dimension. The gross value added per employee of Spanish SMEs is 42,841 euros, compared to the 51,718 euros average of the European Union (EU), which represents a gap of nearly 17%. And if compared with France (73,122) or Germany (74,540), the distance is more evident. But the difference is especially important among micro-enterprises, which constitute the bulk of the business fabric: for businesses with 0 to 9 employees, 34,781 euros compared to a community average of 52,908 or 74,540 in Germany.

The issue is that companies have the intention or desire to gain dimension, but they run into a series of limitations that have been denounced for years and that never seem to be reduced or avoided. Most blame bureaucracy and a regulation they consider excessive. And they also include in the list of obstacles a tax system that they believe is “disincentivizing”.

Cañete states that there are "entrepreneurs who want to gain dimension, invest, hire, and internationalize, but too often they find themselves with a new obligation, a new administrative burden, or a higher cost precisely when they take the leap." This makes one think that size does indeed matter.