Limassol businesses are finding it increasingly difficult to operate as labour shortages, administrative bottlenecks and mounting payment delays begin to reinforce one another, according to the Limassol Chamber of Commerce and Industry’s (Evel) autumn 2025 business barometer.

What emerges from the survey is not a picture of a sudden downturn, but rather one of persistent pressure. Problems that businesses have been flagging for years now appear more deeply embedded, shaping day-to-day operations and limiting scope for expansion.

At the centre of those pressures remains the shortage of skilled labour, which once again tops the list of concerns, accounting for 22.5 per cent of responses.

Companies across sectors report that demand continues to outstrip supply for technicians, engineers, professional drivers, skilled manual workers and specialised sales staff.

In many cases, vacancies remain open for extended periods, forcing firms to stretch existing staff or delay projects.

Although hiring from abroad is increasingly seen as unavoidable, respondents made clear that it is far from a straightforward solution.

Lengthy procedures, regulatory constraints and higher employment costs were cited as significant obstacles, reducing the effectiveness of foreign recruitment and reinforcing the sense that labour shortages are becoming structural rather than temporary.

Even so, recruitment plans have not collapsed. Nearly six in ten respondents said they intend to hire staff over the next three months, with demand again concentrated on skilled labour.

Rather than signalling optimism, however, this points to the depth of the problem, as companies continue to chase scarce skills simply to maintain operations.

Alongside workforce constraints, dissatisfaction with the public sector remains a defining feature of the business environment.

Government services ranked second among the most pressing challenges, cited by 15.2 per cent of respondents. Businesses pointed to slow procedures, fragmented communication and a lack of clear guidance, describing an administrative system that frequently delays decisions and complicates routine processes.

That frustration is reflected more broadly in perceptions of public-sector support. More than half of respondents said public services are only marginally helpful, or not helpful at all, in facilitating business activity, a sharp deterioration compared with spring 2025.

Very few businesses feel that procedures are actively facilitated, reinforcing concerns about inefficiency rather than isolated delays.

Against that backdrop, the Barometer highlights a notable deterioration in payment discipline. Difficulties in collecting debts rose to third place among business concerns, reaching 11.8 per cent and entering double-digit territory for the first time.

Respondents linked the problem directly to cash-flow pressures, with late payments increasingly spreading through supply chains and weakening liquidity.

For many businesses, this problem is compounded by delays in the justice system. Court delays were cited by 6.7 per cent of respondents, who said enforcement is undermined by lengthy procedures and cases that can take years to conclude.

In practice, this leaves companies exposed, often financing customers who fail to meet their obligations while legal remedies remain slow and uncertain.

Cost pressures continue to weigh heavily. Rising labour costs were again cited as a concern, reflecting higher wages, payroll burdens and the impact of living costs, particularly in specialised roles.

Competitiveness also remains under strain, with firms pointing to intense domestic competition and growing pressure from lower-cost international markets, especially in Asia.

Although concerns about interest rates have eased somewhat compared with earlier surveys, financing conditions are still seen as restrictive, limiting investment appetite.

That caution is evident in investment plans. Fewer than half of respondents said they intend to invest in the coming three months, a softer reading than in previous editions.

Where investments are planned, they are focused mainly on buildings, computer and manufacturing equipment and renewable energy, while interest in software and intellectual property has eased.

Among those holding back, cost considerations, uncertainty about the economic outlook and funds being directed elsewhere were the most frequently cited reasons.

Sales expectations suggest stability rather than momentum. In Cyprus, nearly two thirds of respondents expect sales to remain broadly unchanged over the next three months, with only a modest share anticipating growth.

Expectations for overseas sales are even more subdued, with a significant proportion of businesses either forecasting stability or expressing uncertainty, underlining continued caution in external markets.

Risk perceptions reinforce that view. Rising costs remain the most significant risk over the near term, followed by domestic and overseas competition, financial market volatility and constrained access to finance.

By contrast, labour unrest and exchange-rate movements were seen as less acute, though still present in the background.

When asked what would most help improve competitiveness and innovation, businesses pointed to investment in digital transformation, artificial intelligence tools, collaboration with universities and research organisations, and simpler funding procedures.

At the same time, excessive bureaucracy and policy inconsistency were repeatedly cited as factors holding back progress, particularly for smaller and medium-sized firms.

Confidence in the broader economy remains subdued but stable. Just over 70 per cent of respondents said their confidence in the Cyprus economy has remained unchanged in recent months, while a smaller share reported improvement.

Nevertheless, uncertainty remains elevated, driven by geopolitical risks, rising commodity prices, international trade tensions and intensifying competition from overseas markets.

Asked which government actions would most improve the outlook, respondents pointed first to reducing business and corporate taxation, followed by cutting red tape, abolishing or reducing the defence levy on Cyprus shareholders and lowering VAT.

Clearer regulations, more consistent policies and a more responsive public sector were also repeatedly highlighted.

Overall, the autumn 2025 barometer points to a business community that is still operating, still hiring and still investing selectively, but doing so under growing strain.

With labour shortages entrenched, administrative inefficiencies unresolved and payment discipline deteriorating, the survey suggests that without targeted reforms, pressure on Limassol’s businesses is likely to persist rather than ease.