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Solo self-employed deeply insecure because of the Ukraine war

2022-04-07T07:09:40.214Z


The war in Ukraine has dashed hopes of an economic recovery after the corona crisis. The self-employed, in particular, are losing confidence in the future.


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Hairdressing salon: Uncertainty is growing

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Magdalena Troendle / dpa

The Ukraine war not only lowered the mood in the executive floors of large corporations, but also in micro-enterprises and the self-employed.

The business climate index for this economic sector fell to minus 10.0 points in March, after plus 2.6 in February, as the Munich Ifo Institute announced on Thursday.

"February's burgeoning hope collapsed due to the Russian attack on Ukraine," said Klaus Wohlrabe, head of Ifo polls.

»Uncertainty is spreading even among micro-enterprises and the self-employed.«

The clear decline in the Ifo index is due to the crash in expectations for the next six months.

The companies surveyed assessed their overall situation slightly better.

At the same time, the number of companies considering price increases is increasing.

"The micro-enterprises and the self-employed are no exception," it said: Every second company reported plans for price increases.

Russia invaded neighboring Ukraine on February 24, prompting the West to impose tough sanctions.

This caused the Ifo index, which is considered an important leading indicator for the development of the German economy, to collapse in March.

Companies are struggling with rising energy costs, but also with shortages of various materials and preliminary products.

The economists have therefore drastically lowered their growth forecast for Germany: Gross domestic product is only likely to increase by 1.8 percent this year instead of the 4.6 percent expected in November.

A severe recession cannot be ruled out either.

Around 9,000 managers are surveyed monthly for the index.

Since August 2021, the Ifo Institute has been calculating the business climate index for the self-employed and micro-enterprises with fewer than nine employees, cooperating with Jimdo, a provider of online tools.

All economic sectors are represented, but the focus is on the service providers.

mike/Reuters

Source: spiegel

All business articles on 2022-04-07

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