23% of India’s SMBs are still shut as the pandemic and other global shocks linger on | The Financial Express

23% of India’s SMBs are still shut as the pandemic and other global shocks linger on

Ease of Doing Business for MSMEs: With respect to workforce, 19 per cent of the 535 Indian businesses reported reducing their workforce, 26 per cent added more jobs and almost 55 per cent reported no change in the number of employees.

23% of India’s SMBs are still shut as the pandemic and other global shocks linger on
Women-led SMBs have suffered significantly more than the men-led SMBs with higher proportions of business closure globally, at 23 per cent as compared to 17 per cent respectively.

Ease of Doing Business for MSMEs: The impact of the disruptions caused by the covid pandemic don’t seem to have an end in sight for the Indian MSME ecosystem. Findings by Meta’s (formerly Facebook) Global State of Small Business Report 2022 shows that 23 per cent of the 810 small businesses surveyed in India are still shut due to the several COVID-19 waves and other business challenges, higher than the global average of 19 per cent. 

SMBs across the world are facing threats from supply chain disruption, geopolitical uncertainty, increased cost of business and inflation. 

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The findings of the report are from the survey conducted by Meta in July 2022 of around 22,000 SMBs across the globe. Out of the 30 countries and territories covered, Europe had the lowest proportion of SMBs being closed (14%) and the Middle East and North Africa being the region with the highest proportion (33%).

With respect to workforce, 19 per cent of the 535 Indian businesses reported reducing their workforce, 26 per cent added more jobs and almost 55 per cent reported no change in the number of employees.  

As a matter of fact, only 7 per cent of SMBs globally reported plans to reduce their number of workers over the next six months. However, for South Asia regions, these findings were higher where 17 per cent expected to add more workers.  

“There is still a risk of long-term unemployment as public support is scaled back, with many countries’ employment proportions projected to remain below pre-crisis levels until at least the end of 2022” the report highlighted. 

Women-led SMBs usually are seen to have been affected more than their male counterparts and the findings of this report reiterate the fact. Women-led SMBs reported higher proportions of business closure at 23 per cent as compared to 17 per cent respectively across the globe. 

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On a positive note, this gap is 2 percentage points lower than in January 2022 and despite higher closure rates, women-led SMBs reported better sales performance compared to men-led SMBs.

“South Asia also shows differences when compared to the global averages. Increases in transportation costs and legal compliance costs were reported less often than the global average by 19 percentage points (21% against the global average of 40%) and 12 percentage points (11% against the global average of 23%), respectively, in the region” the report stated.

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