Small businesses in Neuchâtel start to feel pinch

In canton Neuchâtel, local officials are starting to worry about the impact of the financial and economic slowdown. The cantonal employment service says five local companies recently resorted to state assistance in order to avoid redundancies. With many local companies relying on exports, Neuchâtel's government is examining what measures might be needed to support the region's economy. While stock markets are surging up and down, local companies in canton Neuchâtel are starting to suffer from the economic slowdown, according to regional authorities. Five local small- to medium-sized businesses have resorted to the “short time unemployment law“, a special procedure allowing government support to avoid redundancies. The Federal state will pay wages of employees for a short period of time. 
“It's aimed at helping companies on a short-term basis, when their situation is critical,“ explained Daniel Grassi Pirrone, head of the local employment service. Six other small companies have also approached the service because of economic problems, he added. Authorities declined to say how many people the firms employed.

Bernard Soguel, head of Neuchâtel’s economy department, and the cantonal government were on Thursday discussing other measures that could be taken to support the local economy. Many companies in the canton rely on troubled export markets, and the economic climate abroad has a strong influence on the order books of local companies. The unemployment figures for September, with an jobless rate of 3.2 percent - a rise of 0.1 over the previous month - were not regarded as alarming. But officials fear that October's figures could reveal a deterioration in the situation as the financial crisis carries on. “We’re waiting“, said Grassi Pirrone.

One key employer is the watchmaking industry, whose 180 companies in the region employ 12,000 people. According to industry executives, it can weather the financial crisis. “We made big investments last year, we can face the economic ebb and flow“, said Jean-Daniel Pasche, president of the Swiss watchmakers association, the Federation Horlogère. With its emphasis on the luxury market, the watchmaking industry does not feel that it is as hard hit as other industries by the fallout from the financial crisis.

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FONT-SIZE: 10pt; local economy. "We're waiting", said
Daniel Grassi Pirrone.Still, Bernard Soguel, chief of the Neuchâtel's
economic department, was debatting yesterday with the state council about
measures that could be taken. It might result in a plan the Grand Conseil would
adopt. Neuchâtel has a lot of exporting companies. Thus, situation of the world
economy has a strong influence on local companies' order books. The unemployment
figures for september are not yet alarming. But things could be different in
october as the crisis carry on.Well established in the region, the industry horlogère contributes around 12000
jobs to the Neuchâtel economy and the sector counts around 180 companies.
According to the experts, it can handle the financial crisis. "We  made big
investments last years, we can face the economics fluctuations", said
Jean-Daniel Pasche, president of the swiss federation horlogère. Proposing
products on upmarket, industry horlogère
is not as affected as the other industries by the financial crisis.