European Commission: SMEs still struggling

In a recent European Commission release, the path of small and medium enterprises to recovery shows some promise, but is still lacking the employment levels pre-2008. Although value added in 2013 was strong in some countries, employment in SMEs was still 1.9 million employees and 2.16 percent below the 2008 levels. In 2013, the number of SMEs and the size of their workforce declined by 0.9 percent and 0.5 percent, respectively. SMEs in construction and manufacturing suffered the most from the crisis, persistently declining in value added between 2008 and 2013. Business services, information and communication and real estate sectors showed relative growth in the same period. In Germany, Austria, Sweden, Belgium, UK and France, among others, value added is strong, but not necessarily employment. On the other hand, Greece, Spain, Portugal, Croatia, Cyprus, Ireland, Romania and Hungary, among others, had value added that was 10 percent lower than before the beginning of the crisis. The situation in Poland shows an increase in enterprises and employment but a decrease in value added over the 2008-2013 time span. This suggests a low value-added sector dominance in Poland. Throughout the European Unioin, there are 21.6 million SMEs in the non-financial business sector. These firms employ 88.8 million people and generate €3,666 trillion in value added. The EU’s Small Business Act continues to improve the administrative and legal environment for businesses in an effort to create a level playing field for SMEs.