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Says a japanese proverb that the nail that stands out most is also the most strokes of the hammer receives. An ode to the homogeneity of both values the society nippon, but also a reflection of the atmosphere in the entrepreneurial ecosystem Spanish. 99.3% of our companies are micro or small, that is to say, with fewer than 50 employees. A situation that contrasts with that of Germany, Uk or the US, where the medium-sized company not only have a higher weight, but they play an essential role, and have established a network of security, the so-called “mid market”, which has proved critical to contain the onslaught of economic coronavirus. Network the spaniards, however, we did not manage to work.
On average, a company in Spain has the 4.7-workers, an amount somewhat higher than the 4 of Italy, but which remains below the 5.7 from France, 11 from Uk and 11,7 Germany. And the situation is not new. Both the academic world and the business and political have for years discussed about the need of having an enterprise population of most medium sized to be able to be more productive, better compete, create jobs of higher quality, and, in short, cope with more security, tsunamis, economic as the current .
But, despite the warnings, the trend not only has not reversed, but has continued to rise. According to the latest annual report of the Bank of Spain , the proportion of smaller companies has increased in the last decade and the percentage of firms with fewer than five employees reached 78% in the past year. Why so many Spanish companies seem to suffer from the syndrome of Peter Pan? Experts point to several factors, but legal obstacles and bureaucracy seem to be a good part of the blame.
Many companies prefer to renounce to grow to avoid having to delegate, according to the expertosDe media, a company in Spain has the 4.7 employees. Away from the 11 Uk and 11,7 from Germany
The regulation builds a glass ceiling that many entrepreneurs do not dare to break. To exceed 50 employees, or a certain turnover or assets, the company automatically assume a greater economic burden and administrative. So, they are forced to constitute a committee of company, to make payments for VAT on a monthly basis , and not quarterly, no longer being able to present the accounts in an abbreviated format and must hire an auditor. The Bank of Spain states, “the presence of a number abnormally high proportion of firms just below the threshold of regulatory”. Raising these thresholds up to a hundred employees has been put on the table on several occasions, but without success. The last attempt was in 2017, when the Ministry of Economy, which was headed by Luis de Guindos issued a report in which it identified 130 standards that were impeding the growth of the company, in order to reform them in a future that never came.
Meanwhile, many entrepreneurs are pulling rogue to try to save this step. “It is evident the ability of firms to avoid the costs of jumping the thresholds without losing production efficiency. For example, companies with distributed assets, number of employees and figures of billing between legal entities distinct by avoiding to exceed thresholds, although for the purposes of organizing the production of all of the assets are leveraged under a single production technology,” says a report on “Size and productivity of the Spanish company,” prepared by economists Emilio Huerta, the Public University of Navarra , and Vicente Salas, of the University of Zaragoza .
the image of The entrepreneur
Emilio Ontiveros, chairman and founder of International Financial Analysts (Afi) , acknowledges the existence of so-called curse of the employee and fifty, but said that the attempt by employers to bypass these obstacles, “it is a mistake” and is served from cultural patterns to explain it. “In Spain need to professionalize management. The best of each family is assigned to the business function. The problem is that socially it was not well seen as the prototype of the entrepreneur has not always been the best. However, I think that the situation began to change from the crisis of 2008 and each time I see more young talent that bet to stay in the family business to try to transform it, instead of going to a large bank or a large consulting company,” he says.
Also professor Chambers points to the importance of management beyond the ballast regulatory . “It is clear that growing up has some external costs, directly related to the regulation, but do not underestimate the internal. To win size, the entrepreneurs have to delegate important functions and to do this they have to find a candidate that you trust and that have the proper training. And here, unfortunately, we are weak. In Spain, many companies do not grow by not delegating,” he says.
The playing field in which we operate also has its weight in the explanation.
Our economy is biased towards branches of activity, such as tourism and hospitality, which tend to be dominated by small-sized companies , compared to for example manufacturing. And, of course, the eternal tangle autonomic. Communities have increased their regulatory development in recent years, so that today “there is a striking heterogeneity in the procedures regional necessary, for example, to undertake certain investment projects”, reports the Bank of Spain. Some obstacles that “could not only be limiting the creation of enterprises, but also its ability to later development”, he insists, because they complicate exponentially the administrative work of the companies.
With these withs work seems simple, but motivating. What explains Mercedes Pizarro, director of economy of the Circle of Entrepreneurs : “We need to get the backpacks of the companies to go lighter. Must take advantage of this crisis to once and for all the pending reforms and relaunch our economy. There is a very clear correlation between the level of development of an economy and the size of their businesses. The largest companies in creating more skilled employment and contribute to the development of a most complex ecosystem that generates jobs, direct and indirect, more qualified and provide more value. There is much at stake and so much room to grow.”
