MSMEs Eye Growth, Set to Hire More

The survey, which covered 1,200 MSMEs across India’s manufacturing, services, and trading sectors, evaluated business sentiment on 22 key parameters such as sales growth, profitability, employment trends, financial access, cost of funds, and ease of doing business. The survey had a wide-reaching scope, spanning 77 cities (Tier 1, 2, and 3) and 66 villages, ensuring a diverse representation of MSME voices.

Key findings highlight strong business confidence, particularly in the manufacturing sector, with notable optimism around sales, profitability, skilled labor availability, and access to finance in the upcoming quarters. The report also reveals an ongoing rise in digital adoption and sustainability initiatives among MSMEs.

The Manufacturing Business Confidence Index (M-BCI) recorded a high of 60.33, with the Services M-BCI following closely at 59.67. The Manufacturing Business Expectations Index (M-BEI) indicates continued optimism for the next four quarters, with projected values surpassing 60 and manufacturing exceeding 70. This indicates positive expectations in areas such as sales, profitability, skilled labor availability, financial access, and overall business conditions.

Although about one-sixth of the respondents across sectors expressed dissatisfaction with labor productivity and the availability of skilled labor during the survey period, they expect these conditions to improve in the upcoming year. Employment remained steady in the October-December 2024 quarter, with most respondents reporting no change in their workforce size. However, expectations for the future are bullish, with 30-40 percent planning to increase their workforce in the next quarter. The manufacturing sector displays the strongest optimism, while the trading sector shows more subdued expectations. Additionally, there is a growing trend towards adopting digital modes for selling and marketing.