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For the period from April to September 2018 the net percentage of euro area SMEs reporting higher turnover increased (25%, up from 24% for the previous period). However, a smaller percentage indicated increasing profits (3%, down from 4%), as more SMEs reported growing labour costs (51%, up from 50%), increases in other costs (i.e. material and energy) (57%, up from 54%), and rising interest expenses (4%, up from 2%).
Availability of skilled labour continued to be the dominant concern for euro area SMEs (26%, up from 24%), followed by the difficulty of finding customers (22%, down from 23%).
Access to finance remained the least important concern (7%, down from 8%). In net terms, SMEs continued to indicate improved availability of bank loans (11%, down from 14%), with the highest percentages in Spain (21%), Ireland (15%) and Slovakia (14%). SMEs attributed these improvements to the willingness of banks to provide credit (17%, down from 19%). However, in this survey round fewer euro area SMEs (net 2%, down from 13%) reported that the general economic outlook was having a positive effect on the availability of external finance. While the reduction was broad-based across countries, it was most marked in Italy (-7%, down from 2%), Spain (-1%, down from 24%) and France (‑5%, down from 9%). Only Greece bucked this trend, albeit starting from very negative territory (-11%, up from -27%).
For the first time since 2014, on balance SMEs also reported rises in interest rates on bank loans (3% net, up from -1% in the previous round). At the same time, most SMEs signalled increases in other costs of financing, such as charges, fees and commissions (31%, up from 26%).