What really happens to small and medium-sized enterprises in a global economic recession? UK evidence on sales and job dynamics

Marc Cowling, Weixi Liu, Andrew Ledger, Ning Zhang

Research output: Contribution to journalArticle

64 Citations (Scopus)
651 Downloads (Pure)

Abstract

This article uses UK data to consider how small and medium-sized enterprises (SMEs)1 coped during the recent financial crisis. This is important, as SMEs are major contributors to job creation, but are vulnerable to falling demand. It finds that 4 in 10 SMEs experienced a fall in employment during the recession, and 5 in 10 experienced a fall in sales. Within 12 months of the recession, three-quarters of entrepreneurs had a desire to grow. This suggests that while the immediate effects of recession are severe, entrepreneurs recover quite quickly. Importantly, the analysis found that recessionary growth is hugely concentrated among entrepreneurs with the highest human capital.
Original languageEnglish
Pages (from-to)488-513
Number of pages26
JournalInternational Small Business Journal
Volume33
Issue number5
DOIs
Publication statusPublished - Aug 2015

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