Development Trends of Small and Medium-Sized Enterprises Amid Pandemic-Induced Crisis

Stepan P. Zemtsov – Leading Researcher of the Russian Presidential Academy of National Economy and Public Administration; Senior Researcher of the Gaidar Institute, Candidate of Geographic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Yulia V. Tsareva – Researcher of the Russian Presidential Academy of National Economy and Public Administration (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Against the backdrop of coronavirus pandemic-induced economic crises, small and medium business sector oriented towards off-line services provision has been worst-hit. In reality, demand for services provided by catering, entertainment, tourism, hospitality, beauty-business, and non-food retail has declined several-fold amid lockdown. This being said, the need to pay wages, taxes, social contributions, rental charges, bank credit interest, and contractors for supplies and other services has remained. All types of businesses who missed the chance to switchover to online services provision or stick to business model for rendering exclusively personal off-line services to date are exposed to bankruptcy risk.

Cash gap is on the rise that can lead to bankruptcy of multiple small and medium-sized enterprises (SME) unable rapidly and without losing work performance to switchover to the online regime especially in large Russian cities. In this memorandum we present assessment of the crisis impact on income, employment, lending, and the number of SMEs.

Key words: small and medium-sized enterprises (SME), pandemic, crisis.