80% of Balearic entrepreneurs are confident of increasing their sales in 2023, 67% expect to increase investment and 48% to expand their workforce, according to the report ‘Balearic Islands Outlook 2023’ carried out by KPMG in collaboration with the CEOE. 58% of the businessmen surveyed in the islands rate the current situation of the Spanish economy as fair, and 22% as good or very good.
They are cautious in their economic forecasts, since the majority opinion in 12 months is that the economy will remain the same, while 32% believe that it will improve. Looking specifically at the Balearic economy, 48% of managers rate it as good and 36% expect it to evolve positively in the coming year.
In the business sphere there is the greatest optimism: 80% rate their current situation as good or excellent, and 64% are confident that their organization will improve throughout the year, compared to 44% for Spain as a whole. In addition, most managers expect to increase the number of employees.
The report also explores the effects of inflation on other areas of corporate management. Sixty-five percent of executives say that inflation has had a high or very high impact on their organization’s profit margins. This has led two out of three respondents to redefine their pricing policies to reflect rising costs, while 25% plan to do so in the next twelve months. The study also found that 58% of managers in the region consider inflation to be the biggest threat to the Spanish economy over the next three years.
A 73% of employers recognize having difficulties in incorporating the talent they need. The gap between companies and the labor market is of particular concern.
The president of CAEB, Carmen Planas, remarks that “the Balearic Islands are still overcoming the double crisis: two very hard years of pandemic, where the Balearic GDP fell twice as much as the national average, and the energy and inflation crisis that began in 2022”. All in all, supported by a “powerful tourism sector”, Balearic entrepreneurs face 2023 “with optimism, but with great challenges on the table, among them, continuous and specialized training to meet the great demand for professionals.”
The head of KPMG in the Balearic Islands, Ignacio del Río, assures that the entrepreneurs of the archipelago “are aware of how important it is to anticipate risks and challenges” in these uncertain times. “Talent, digital transformation, process improvement and sustainability are crucial aspects in business models and are on the table of all the boards of directors of companies in the region,” highlights Del Río.