KMU ZH Monitor 2024: Slight easing of the skills shortage

SMEs in Zurich rated their economic situation as solid in the first half of the year. Compared to last year, however, business appears to be slightly worse. A slight improvement on the current situation is expected for the coming year. SMEs are therefore assuming that the trough will be reached this year or has already been reached.

This is shown by the latest "KMU ZH Monitor" study. On behalf of Zürcher Kantonalbank, the Zurich University of Applied Sciences (ZHAW) took the pulse of the canton's SMEs for the fourth time. 746 companies with a maximum of 250 employees each took part in the scientific study (survey period March to May 2024), which covers the following sectors:

- Industry
- Construction/Architecture
- Trade
- Gastronomy/hotel industry
- Economic services
- Social services

SMEs remain slightly optimistic about current business development (comparison of current financial year 2024 with financial year 2023), but less positive than the business situation in the previous year.

SMEs are partly left with rising costs

The increase in net profit cannot quite keep pace with the increase in sales, which indicates that the increased costs cannot be passed on in full to end customers.

In a long-term comparison, the capacity utilization of SMEs is rated as lower than in the last two years. This trend can be seen across all sectors. In particular, the industrial sector and the catering/hotel industry recorded the sharpest decline in capacity utilization.

Industrial companies are struggling with the strong Swiss franc and subdued demand from the eurozone. Fortunately, supply chain problems as a result of the COVID-19 crisis have largely eased. The industrial sector in particular has suffered from the disrupted availability of production factors since the start of the pandemic. The availability of production factors is currently rated as "rather good" across all sectors, which is a significant improvement on previous years. 

Compared to other sectors, the food service/hotel industry considers its current situation to be modest and significantly worse than a year ago. For example, gastronomy/hospitality companies very frequently cite inflation and, as part of this, energy prices as a challenge. Regulations and requirements from authorities and labor shortages are also frequently cited challenges. The lack of workers means that restaurants and hotels have to reduce their offerings or opening hours in some cases - despite demand - which leads to a drop in sales.

The shortage of skilled workers is easing

The catering industry is by no means the only one that sees the shortage of skilled workers as the biggest challenge. Almost half of the companies surveyed share this view. This challenge was already mentioned most frequently last year, but the percentage of mentions has fallen slightly. Across all sectors, medium-sized companies appear to be more affected than small and micro companies.

Another major challenge is perceived to be the regulations and requirements of the authorities. This challenge is most pronounced for companies in the catering/hospitality and construction/architecture sectors. According to SECO's Bureaucracy Monitor 2022, regulations relating to construction projects and food hygiene are perceived as particularly burdensome. 

The topic of "digital transformation and process optimization" is the third most frequently cited challenge. This shows that medium-sized companies perceive this as more of a challenge than smaller companies. 

Medium-sized companies see more potential in AI than smaller companies

As part of the study, SMEs were also asked about artificial intelligence and how it affects companies.

Here, too, it is the medium-sized companies that state that AI will have a positive impact on the development of the company and that this will create competitive advantages. It is possible that medium-sized companies are taking a more proactive approach to digital transformation and are therefore increasingly seeing the benefits of artificial intelligence. 

Looking at the results of the study by sector, it can be seen that the business services, industry and retail sectors in particular agree more often than the other sectors that AI will have a positive impact on company development. The majority of the gastronomy/hospitality sector sees hardly any positive effects.

Source: www.zkb.ch