The loss of skilled workers is a key reason why some businesses are scaling back, according to the 2008 Guyana Business Outlook Survey by Ram & McRae Chartered Accountants.
In the 19-page survey released on Monday, eight of the 74 respondents indicated they would scale back operations and noted that “high operating costs, (and) availability of skills” were among the main reasons, along with the performance of the economy and government policies. Forty-two or 57% proposed increasing the scale of their operations and twenty-four or 32% projected no change.
“The principal reasons attributed for the change in workforce are changes in the level of operations and significantly, migration,” said the Survey.
As a result, 53% of the respondents anticipated increases in their work force ranging from under 5% to more than 20%, while eight of the 74 respondents or 11% expected a decrease. Of those which responded, 43 or 58% had less than 50 employees and 22 or 30% had between 51 and 250 employees and four or 5% had between 500 and 1000 employees, noted the Survey.
“In the event of limited financial resources businesses are most likely to cut back on capital investment programmes, advertising and public relations programmes, research and development, pursuit of new markets, and employment levels and costs,” explained the Survey.
Wish list
According to the Survey the wish list for businesses in 2008 in ranked order are: Lower direct taxation (Income, Corporation among others); lower taxation (Value Added Tax (VAT); Implementation of a formal plan to tackle crime; improve efficiency of government departments; reduce interest rates; control inflation; take steps to lower exchange rates; measures to curb the migration of skilled workers; enhance governance; improve on duty free incentives; remove taxes on property transactions; spend more on capital projects/public works; expand tax holidays and remove dependency on currency of US dollar.
Operating conditions
Seventy-six percent of the respondents indicated that they operate within a formal plan, while an additional 8% said that they prepared projections but answered no in relation to if they operated within a formal plan. Similarly, 26% of the respondents prepare financial projections for periods extending from one year to beyond five years in exceptional cases but 12 of the respondents or 16% do not operate with any sort of plan.
Those who prepare projections formally review performance against budget with the majority, 50%, doing so on a monthly basis, 31% quarterly and 15% half-yearly.
Eleven or 15% of the respondents offer their employees equity participation in their business and less than half share financial information with them. However, bonus and other profit-related remuneration are employed by the overwhelming majority of respondents, 78%.
The Survey this year elicited one of the largest responses over the 13 years of the Survey. Questionnaires were sent via electronic mail on November 21, 2007 and according to the Survey the wide response “is a measure of the private sector’s facility with computers and their use.” The manufacturing and distribution sector accounted for over 40% of the respondents but there were also replies from sectors such as construction/architecture, consultancy and professional services and the financial sector – banking/finance and insurance.
