The revenue of small and medium-sized enterprises (SMEs) recorded an increase of 5,2% in the second quarter of 2024 compared to the same period in 2023, according to the Omie Index of Economic Performance of SMEs (IODE-SMEs). The positive result closes the semester with an accumulated growth of 4,3% compared to the same period last year
The IODE-PMEs functions as an economic thermometer for companies with annual revenues of up to R$50 million, consisting of the monitoring of 701 economic activities that make up four major sectors: Trade, Industry, Infrastructure and Services
According to Felipe Beraldi, economist and manager of Indicators and Economic Studies ofGrandma, cloud-based management platform (ERP), SMEs benefited from the evolution of family income – with the performance of the labor market and government policies for income expansion –, and the impacts of the cycle of falling interest rates promoted by the Central Bank, between August of the previous year and May 2024
Figure 1: IODE-SMEs
(Index number – base: average 2021=100
Sources: IODE-PMEs (Omie)
The sector analysis shows that SMEs in the Industry continue to be the main contributor to the improvement of the market, with an advance of 11,9% (YoY) in the period. This progress is spread across 18 of 22 activities in the sector, among them, Lubricating oils, Metallurgy, 'Printing and reproduction of recordings' and 'Maintenance', repair and installation of machines and equipment recorded an increase
The increase in domestic demand and reduction in cost pressures positively impact small industry. Thus, part of the recovery of the real revenue of the segment reflects the relief of inflation to the producer (IPA-FGV), which recorded deflation until May (-1,7% in the accumulated over 12 months, explain Beraldi
The economist points out that another highlight in the last quarter was the recovery of small and medium-sized enterprises in Commerce, that recorded an expansion of 4,6% compared to the second quarter of 2023. The results are positive both in wholesale (+7,5% YoY – with emphasis on 'Books, newspapers and other publications, 'Cement' and 'Hygiene products', house cleaning and maintenance –, how much in retail (+3,0% YoY, 'Pharmaceutical products with formula manipulation', 'Glasses', and 'Notions of haberdashery' the activities of better performance
In Services, despite the still positive result in the second quarter (+0,6% YoY, signs of deceleration begin to appear. "Even though the increase in income supports the sector, the recent loss of confidence among economic agents may have harmed the revenue of some sectors, comment Beraldi
Among the most prominent activities, are 'Financial and insurance activities', 'Accommodation and Food' and 'Education'. On the other hand, Administrative activities and complementary services, that showed good performance at the beginning of the year, closed the second quarter down
In the Infrastructure segment, in turn, SMEs deviate from the behavior of the rest of the market and show a retraction of 4,6% (YoY) in the second quarter of 2024. The negative result reflects the weak performance in some segments of the construction industry, as 'Infrastructure works' and 'Building construction'. The advancement of 'Specialized services for construction', 'Capture, water treatment and distribution and Collection, waste treatment and disposal, however, prevented sharper falls
Figure 2: IODE-PMEs – sector openings
(2T2024 x 2T2023)
Sources: IODE-PMEs (Omie)
In the division by regions, the IODE-PMEs also shows that the growth in the last quarter was driven by the performance of SMEs in the Southeast region (increase of 2,2% compared to Q2 2023, Northeast (+9,5%) and South (+5,6%). In the Central-West and North regions, the IODE-PMEs indicated a contraction of SMEs during the period (-2,2% and -9,5%, respectively
SMEs expected to grow at the same pace as GDP in 2025
Due to the resilience of the labor market (with unemployment approaching the low historical level of 7% in recent months) and the effects of the contained easing of monetary policy (with the Selic falling since August of last year), it is expected that SMEs will maintain the recent growth trend in the second half and end 2024 with revenue 4,3% higher than 2023. For 2025, the expectation is high at 2%, more contained bet aligned with the forecasts for Brazilian GDP
According to Beraldi, a higher interest rate compared to what was previously expected – perspectives are among 9,5% to 10% to.a. – it means less growth stimuli coming from credit. This results in less pressure on consumption and investments. There is little room for new impulses in the labor market and less intensity of fiscal stimuli next year due to the great need for adjustment in public spending
"With that, we assume that the evolution of the SME market occurs concentrated in the Services and Trade sectors – reflecting the perspective of sustaining family consumption, complete Beraldi. The expectation, still according to the economist, that interest rates falling again in 2025 should also have positive impacts on the Infrastructure sector, mainly for civil construction
