SMEs

Small and medium-sized enterprises (SMEs) are businesses with limited size in terms of employees, turnover, or balance sheet total. Definitions vary by country. In the European Union, SMEs employ fewer than 250 people and have thresholds for turnover or balance sheet total; micro-enterprises have fewer than 10 employees. In the United States, the Small Business Administration sets industry-dependent size thresholds, sometimes up to 1,500 employees.

SMEs account for a large share of private employment and are important for competition, innovation, and regional development. They often serve as suppliers in larger value chains, support local services, and contribute to exports. They face constraints such as limited access to finance, weaker bargaining power, and regulatory burdens, with productivity gaps and vulnerability to shocks.

Policy tools include access to finance through guarantees and grants, regulatory simplification, and measures to promote skills, digital adoption, and business services. Public procurement, export promotion, and tax incentives are common means to support SME growth.

Measuring SMEs relies on country-specific thresholds and indicators. Globally, they account for a large share of employment and value added, though data comparability varies. Their contribution to innovation and resilience is recognized, but depends on policy, market conditions, and access to markets and finance.