Deteriorating Business Climate for Self-Employed in October

The business climate for self-employed individuals and micro-enterprises continued to decline in October, according to the Ifo Institute in Munich and online service provider Jimdo. The index dropped to minus 22 points, marking one of the lowest levels recorded. This decline stands in stark contrast to the overall economy, which has seen some signs of improvement.

A significant factor contributing to this downturn is the lack of incoming orders. Nearly half of the self-employed respondents reported experiencing a shortage of work, leading to heightened concerns about their livelihoods. As a result, around one in five freelancers now feels their existence is threatened.

Katrin Demmelhuber from the Ifo Institute noted that larger companies are hesitating to place orders due to economic uncertainties, further exacerbating the situation for smaller businesses. Despite some optimistic expectations for the upcoming months, the negative sentiment among self-employed individuals remains pervasive.

Matthias Henze, the CEO of Jimdo, expressed alarm over the potential for a significant drop in the number of self-employed workers, reminiscent of the nearly eleven percent decrease seen during the COVID-19 pandemic, acknowledged as the most severe crisis for this group. While the broader economy may have stabilized, the challenges for solo entrepreneurs and micro-enterprises are far from resolved, highlighting a growing concern for their future viability.