According to the latest Entrepreneur Gallup, the financial situation of companies has remained nearly unchanged throughout the beginning of the year. One-fifth of small and medium-sized enterprises (SMEs) still report being in a poor situation. Meanwhile, 48% of businesses rate their financial situation as either very good or fairly good—up one percentage point from March.
“In SMEs, we see signs of strengthening purchasing power, slowing inflation, declining interest rates, and upcoming tax cuts that will improve consumer spending. However, the war in Ukraine and former President Trump are sources of uncertainty,” comments Mikael Pentikäinen, CEO of the Federation of Finnish Enterprises.
Among solo entrepreneurs, 22% say their situation is poor, compared to around 15% of businesses with more than ten employees. This suggests that the larger the company, the better its current situation.
Construction Sector Facing the Most Challenges
By sector, construction companies are in the weakest position. Currently, 26% of businesses in the construction sector report being in a poor situation—up from 23% in March. In contrast, the retail sector has seen improvement: the share of businesses in poor condition has dropped from 26% in March to 19% in the latest survey.
Ukraine War and U.S. Politics Create Uncertainty
Outlooks for the coming year have slightly weakened. Currently, 33% of companies expect their situation to improve within the next 12 months—down from 36% in March. Meanwhile, 19% expect their situation to deteriorate. The construction sector again shows the most pessimism.
According to Pentikäinen, the war in Ukraine and the trade war initiated by Trump are casting a shadow over SME expectations.
“We need trade agreements that stabilize the situation,” Pentikäinen states.
Industry Sector Sees the Brightest Outlook
The industrial sector is showing the most improvement: 42% of industrial companies expect conditions to improve, compared to 36% in March. The survey also found that the most optimistic outlooks come from entrepreneurs aged 18 to 39.
Pentikäinen adds that there is reason for cautious optimism, as preliminary data shows that production grew by 1.2% year-on-year in January–March.
“There is a positive risk that the economy could grow more strongly than expected. That could happen if the trade war eases—and especially if a fair peace is reached in Ukraine. However, the latter doesn’t seem likely anytime soon,” Pentikäinen adds.
The Entrepreneur Gallup was conducted by Verian on behalf of the Federation of Finnish Enterprises. A total of 1,351 SME representatives responded between May 6 and 19, 2025. The margin of error is ±2.7 percentage points.
