Norman artisans and small businesses not all equal in the face of the economic slowdown

How are Normandy's small businesses and craftsmen doing? The Normandy Order of Chartered Accountants is trying to provide answers to this question via its SME Image barometer presented at the beginning of the week.

"These everyday players, SMEs and VSEs, make up the vast majority of our customers and we can, thanks to their VAT electronic declarations, analyse the evolution of their turnover", explains Franck Nibeaudo, the president of the order, which uses data from a sample of 24,000 Normandy companies to analyse the health of these players in the local economy, which represent a third of jobs in the region.

And overall, the barometer points to a slight decline in economic activity at the end of last year, of the order of 0.1% compared to the last quarter of 2023, even if, over the entire year, their turnover increased by 0.5%. This places Normandy in the leading group of French regions. With disparities depending on the department since while the Manche increased by 1.1% in the last quarter, the Eure fell by 1.4%, a sign of economic dynamism that is not necessarily well distributed.

It should be noted that these figures do not take inflation into account (around 2% on average over the year according to INSEE). Which does not guarantee an increase in activity or profits. "The year 2024 started off rather well, all sectors combined," analyzes Franck Nibeaudo. "But from the end of the first half of the year, we were able to see a slowdown." The president of the order obviously points to one event in particular to explain this slowdown: "The dissolution and everything that followed created uncertainty. For business leaders, but especially for consumers, for families. The reflex is to save more and reduce expenses, except for those that are forced..."

This explains why not all sectors are on an equal footing. While garage owners (+4.3%) or pharmacists (+3.8%), or even bakers (+1.6%), see their turnover increase compared to 2023, restaurateurs and hoteliers (-1.3%), as well as retail clothing (-2.1%) are falling. This is even more glaring for the construction sector, all activities combined, like masonry which is falling (-5.2%) due to a drop in the number of construction sites, both for communities and individuals.

For Franck Nibeaudo, one of the consequences of this slowdown, which he believes could last at least until the end of the first half of 2025, is the increase in the number of business failures. "Nationally, we are around 65,000, including 2,400 in Normandy. For me, this is partly a catch-up linked to the end of the whatever-it-takes approach during Covid. Fragile companies, which had benefited from state aid but had not changed their economic model, are now paying for it. But what is striking is that previously, we were able to save companies. Today, 77% of them are direct liquidations." With layoffs as a key. This is reflected in the field of unemployment since in 2024, 6,000 new registrants were recorded in the region, including 4,500 in the last quarter alone.