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Small and medium-sized enterprises

Small and medium-sized enterprises (SMEs) are defined by the European Commission as having less than 250 employees. SMEs are the backbone of Europe's economy. They represent 99% of all businesses in the EU. In the past five years, they have created around 85% of new jobs and provided two-thirds of the total private sector employment in the EU. The European Commission considers SMEs and entrepreneurship as key to ensuring economic growth, innovation, job creation, and social integration in the EU. The European Commission policy in relation to SMEs supports start-ups and scale-ups in particular. Internationalisation beyond the EU increases SMEs' performance, enhances competitiveness, and reinforces sustainable growth.

Topic

Recent updates

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Company practices to tackle labour shortages

Explore our digital report summary. This report centres on the recruitment and retention measures that organisations have deployed to address labour shortages, based on 17 case studies in different sectors...

Data story

EU context

Eurofound’s work on small and medium-sized enterprises links in with the Commission’s 2019–2024 priority on promoting our European way of life. 

Key outputs

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Working conditions in sectors

Megatrends, such as digitalisation, globalisation, demographic change and climate change, are transforming the world of work, with knock-on effects for working conditions and job quality. Against this background, this report...

5 November 2020
Publication
Research report
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Social dialogue and HR practices in European global companies

This study examines the interaction between social dialogue practices and human resources management (HRM) policies in European multinational companies (MNCs). It looks at the changing role of HRM and its...

16 June 2020
Publication
Research report

Eurofound expert(s)

​Stavroula Demetriades

Stavroula Demetriades

Stavroula Demetriades is a senior research manager in the Employment unit at Eurofound. She has responsibility for research in the areas of the green and just transition, social...

Senior research manager,
Employment research unit
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Franz Ferdinand Eiffe

Franz Eiffe is a research manager in the Working Life unit at Eurofound. He is involved in projects on sustainable work, quantitative analyses and upward convergence in the EU, as...

Research manager,
Working life research unit
Publications results (58)

Born globals and their value chains

This report explores the motivations, opportunities and challenges of born globals and small and medium-sized enterprises (SMEs) in integrating and managing their global value chains (GVCs). The study also investigates the role of selected policy measures in supporting SME internationalisation, incl

14 December 2018
Publication
Research report
Restructuring
Small and medium-sized enterprises
Entrepreneurship
Industrial policy
Anticipating and managing the impact of change
Employment and labour markets

Job creation in SMEs: ERM annual report 2015

The European Restructuring Monitor (ERM) annual report for 2015 explores the issue of job creation in small and medium-sized enterprises (SMEs). SMEs are increasingly recognised as a job engine for Europe. However, given the heterogeneity of the vast SME population, not all contribute equally to

27 January 2016
Publication
Annual report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Anticipating and managing the impact of change
Innovation
Job creation

Job creation in SMEs - Résumé

In light of the recent economic and financial crisis and its detrimental effects on EU labour markets, both academics and policymakers are paying increasing attention to the role of small and medium-sized enterprises (SMEs) in job creation.

18 November 2015
Publication
Résumé
Job creation
Restructuring
Small and medium-sized enterprises
Employment and labour markets

Social dialogue in micro and small companies

Micro and small companies constitute the backbone of private business in Europe, accounting for nearly 99% of all enterprises, more than half of total employment in the private sector and an even greater proportion of new jobs. Despite their crucial place in the economy, there has been little

20 May 2014
Publication
Research report
Small and medium-sized enterprises
Social dialogue
Health and well-being at work
Industrial relations
Employment and labour markets
Industrial relations and social dialogue

Restructuring in SMEs in Europe

Restructuring is part and parcel of the economic fabric in Europe, as companies must adapt to altered conditions in a bid to remain sustainable and competitive. Most of the policy focus so far, however, has been on restructuring in terms of the large firm. In light of the relative importance of the

17 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment structure
Employment and labour markets
Job creation

Restructuring in SMEs: Finland

Based on information derived from 85 case studies across all EU Member States and other sources, the project outlines the features peculiar to SMEs in their anticipation and management of restructuring, explores the main drivers of change and analyses the factors influencing successful restructuring

01 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Employment and labour markets

Restructuring in SMEs: Czech Republic

Based on information derived from 85 case studies across all EU Member States and other sources, the project outlines the features peculiar to SMEs in their anticipation and management of restructuring, explores the main drivers of change and analyses the factors influencing successful restructuring

01 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Employment and labour markets

Restructuring in SMEs: Lithuania

Based on information derived from 85 case studies across all EU Member States and other sources, the project outlines the features peculiar to SMEs in their anticipation and management of restructuring, explores the main drivers of change and analyses the factors influencing successful restructuring

01 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Employment and labour markets

Restructuring in SMEs: Slovenia

Based on information derived from 85 case studies across all EU Member States and other sources, the project outlines the features peculiar to SMEs in their anticipation and management of restructuring, explores the main drivers of change and analyses the factors influencing successful restructuring

01 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Employment and labour markets

Restructuring in SMEs: Hungary

Based on information derived from 85 case studies across all EU Member States and other sources, the project outlines the features peculiar to SMEs in their anticipation and management of restructuring, explores the main drivers of change and analyses the factors influencing successful restructuring

01 July 2013
Publication
Research report
Restructuring
Small and medium-sized enterprises
Employment and labour markets
Employment and labour markets
Online resources results (26)

Company practices to tackle labour shortages

Explore our digital report summary. This report centres on the recruitment and retention measures that organisations have deployed to address labour shortages, based on 17 case studies in different sectors and across 13 Member States.

25 October 2024
Data story
Employment and labour markets
Labour market policies
Job creation
Small and medium-sized enterprises
Skills and training
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Policies to support EU companies affected by the war in Ukraine

As the war in Ukraine has intensified, the cost of food, raw materials and energy prices, already high due to the COVID-19 pandemic, has continued to rise substantially. Ahead of coordinated action at EU level, as agreed by EU energy ministers on 9 September 2022, governments across the EU have

12 September 2022
Article
Stand with Ukraine
Small and medium-sized enterprises
Social policies
European Green Deal
Industrial relations and social dialogue
Industrial relations

Latvia: Social security implications of favourable tax rate for small businesses

The social partners reacted differently to the government's plans to increase the rate of the special tax for microenterprises, the unions concerned over the lower social protection afforded the workers and employers worried about losing competitiveness due to increased labour costs. In the end, the

23 February 2017
Article
Small and medium-sized enterprises
Social dialogue
Social protection
Industrial relations and social dialogue

United Kingdom: Small Business Act becomes law

The Small Business, Enterprise and Employment Act 2015 puts an end to the use of exclusivity clauses in zero-hours contracts.

11 May 2015
Article
Labour law
Small and medium-sized enterprises
Employment and labour markets
Labour and social regulation

Project promotes innovation and employee participation in SMEs

In June 2001, Portugal's Institute for Innovation in Training (INOFOR) assessed a project it had been running on "Paths to innovation", which sought to promote organisational innovation in small and medium-sized enterprises (SMEs). Such innovation is thought to be rare in Portugal. Notable points

27 June 2001
Article
Small and medium-sized enterprises
Social partners
Industrial relations
Industrial relations and social dialogue

Social partners highlight competitiveness and development issues

According to a survey published in March 2001 by the Confindustria employers' confederation, the innovative capacity of small firms in Italy is being hampered by factors such as the rigidity of the labour market, the lack of skilled labour, and a high tax burden. Meanwhile, at a May 2001 conference

27 May 2001
Article
Social partners
Small and medium-sized enterprises
Employment and labour markets

The state of trade unionism

Trade unions originally developed in Ireland in response to the spread of industrialisation. Many employers in the early factories used authoritarian methods and working conditions were often extremely poor. Individual workers were unable to resist this exploitation, so they organised collectively

27 February 2001
Article
Social partners
Employee representation
Non-standard employment
Small and medium-sized enterprises
Employment and labour markets
Industrial relations
Industrial relations and social dialogue

2001 Territorial Employment Pact agreed for Vienna

Since the mid-1990s, the city council, the Labour Market Service (Arbeitsmarktservice, AMS) and social partner organisations have been cooperating to improve the employment situation in Vienna, which had been relatively poor for some years. In the late 1990s, these efforts were translated into a

27 February 2001
Article
Ageing workforce
Gender equality
Care
Skills and training
Small and medium-sized enterprises
Social policies

Union unite against employers' proposals on supplementary pensions

The "industrial relations overhaul" project initiated by France's MEDEF employers' confederation in early 2000 has given rise to a protest movement involving all trade unions in early 2001, including a day of demonstrations on 25 January. At the root of this protest are MEDEF's proposals on

27 February 2001
Article
Social partners
Retirement
Small and medium-sized enterprises
Industrial action

Forced labour compensation scheme faces difficulties

In July 2000, the German parliament passed legislation to provide compensation for those involved in slave and forced labour during the Nazi period. As the result of lengthy negotiations between the governments of the USA, Germany and several eastern European countries, along with representatives of

27 February 2001
Article
Labour and social regulation
Small and medium-sized enterprises
Blogs results (3)
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What can companies do to spark innovation in the workplace?

As we leave behind the lockdowns and business disruptions of COVID-19 and enter a ‘new normal’, it is time to talk about how workplaces might be transformed to drive innovation. Some may baulk at this suggestion, as we continue to grapple with the pandemic fallout, but crises have always been a crad

28 June 2021
Stavroula Demetriades
Blog
Skills and training
Small and medium-sized enterprises
Participation at work
Working conditions and sustainable work
Working conditions
Work organisation
Innovation
Job quality
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Future of work: What can we learn from cooperatives and social enterprises?

Much of the discussion on the future of work is focused on globalisation and technology, and their impacts on the labour market. However, there is also a growing interest in the business models used by cooperatives and social enterprises, and how they can contribute to a better future of work. Eurof

15 November 2019
Stavroula Demetriades
Blog
Small and medium-sized enterprises
Working conditions
Inclusive labour markets
Job quality
Employment and labour markets
Working conditions and sustainable work
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Trust and dialogue are the secrets to business success in times of crisis

Europe has gone through significant economic change over the past decade. Businesses have had to manage the challenges posed by the financial crisis, globalisation and a rapidly changing labour market. Eurofound's new report Win-win arrangements: Innovative measures through social dialogue at compan

3 October 2016
Stavroula Demetriades
Blog
Industrial relations
Innovation
Small and medium-sized enterprises
Social dialogue
Working conditions
Working conditions and sustainable work
Industrial relations and social dialogue
Data results (5)

Reasons SMEs face difficulties recruiting staff, by occupation and size category, EU, 2023 (% of SMEs)

10 September 2024

SMEs facing difficulties finding workers with the right skills, EU Member States, 2023 (% of SMEs)

10 September 2024

Strategies used to address skills shortages in SMEs, in the EU, 2023, (% of SMEs)

10 September 2024

SMEs that recruited non-EU workers, EU and Member States, (% of SMEs)

10 September 2024

Reasons why SMEs did not recruit from outside the EU, 2023, (% of SMEs)

10 September 2024

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