An environment marked by inflation and cautious growth expectations
The energy crisis, ongoing inflation, and rising interest rates create a nuanced backdrop for Spanish companies that remain hopeful about growth over the coming year, even as forecasts stay prudent. This sentiment is reflected in the Perspectivas España 2023 report, a collaboration between KPMG and CEOE. Seventy percent of business leaders surveyed anticipate higher sales in the twelve months ahead, a seven-point drop from 2022, while expectations to increase investment rise by ten points to 50 percent.
Antonio Garamendi, president of CEOE, commented that the report reinforces the need for policies that foster a stable political framework and high regulatory quality, to sustain investment, the economy, and employment.
Juanjo Cano, head of KPMG Spain, noted that despite the cautious context, Spanish business leaders remain optimistic about organizational development, foreseeing growth in sales and sustained investment and employment. He emphasized that this optimism is grounded in a commitment to advancing digital and sustainable transformation, with the belief that success in these areas will shape medium- and long-term growth in a highly competitive environment that demands rapid adaptation.
On the state of the Spanish economy, 57 percent of managers view it as normal, compared with 53 percent in 2022, while 28 percent classify it as bad or very bad. Yet nearly three-quarters (73 percent) regard their own company as good or excellent. Moreover, 44 percent of surveyed entrepreneurs expect their organization to improve during the year, while the same percentage foresee a worsening of the Spanish economy over the next twelve months.
Hiring plans show a tempered stance. Compared with 2022, the share of respondents planning to expand their workforce decreases to 38 percent, eight points lower than 2022. The proportion that plans to increase staffing remains at 50 percent, seven points higher than the prior edition, illustrating a continued commitment to employment amid volatility.
An inflationary landscape and its impact
The report highlights how inflation permeates corporate governance. Sixty-nine percent of executives report a high or very high impact on profit margins from rising costs. Consequently, more than half (52 percent) have redefined pricing policies to reflect cost increases, with 31 percent planning changes in the next year. Additionally, 45 percent have renegotiated supplier contracts, and 32 percent intend to do so within the year.
Fifty-three percent of respondents identify inflation-fighting measures as a strategic priority for the next twelve months, while 54 percent see rising prices as a major short-term threat to the Spanish economy. When asked to rank inflation-related risks, energy costs, price volatility, and demand risk emerged as the top concerns (38 percent, 36 percent, and 36 percent respectively).
Political uncertainty also stands out as a notable risk, given ongoing local, regional, and national elections. Forty-six percent view political volatility as a threat to the economy in the near term, underscoring the interplay between policy developments and business planning.
Talent: attracting and retaining critical skills
The transformation underway in many companies elevates talent as a top strategic issue. Fifty-seven percent of executives consider attracting and retaining skilled workers a major challenge for the next three years, and nearly half (49 percent) identify it as a strategic priority for 2023. Companies report tangible effects from the skills gap, with 59 percent saying their organization struggles to recruit the talent it needs, and 65 percent agreeing that a shortage of talent threatens their goals.
About this report
Perspectivas España is an ongoing KPMG publication produced since 2009 in collaboration with CEOE over recent years. The 2023 edition engaged 1,116 business people and executives from 24 sectors across all autonomous communities through an online survey conducted between December 2022 and February 2023. A majority of respondents hold senior roles, including chairmen, general managers, owners, or directors, with 29 percent of participating firms employing more than 1,000 people and 33 percent generating annual revenues above 200 million euros. Industry, Business Services, and Consumer Goods were the most represented sectors, with Madrid, Andalusia, and Catalonia accounting for the largest shares of participants. The survey provides context for government, corporate governance, and market dynamics that shape business decisions in Spain.
The KPMG network offers audit, tax, legal, financial, and business advisory services on a global scale, operating in 143 countries with more than 265,000 professionals. Each member firm is a separate legal entity, and KPMG International Limited serves as the coordinating entity for the member firms.
[Citations: Perspectivas España 2023, KPMG and CEOE; data summarized for context and analysis.]