MSMEs stand for micro, small, and medium enterprises, and because more than half the businesses in the world come under these micro, small and medium enterprises, they play a significant role in many economies. According to the World Bank, they account for 90% of businesses, therefore making them the sole job generators which covers 50% of the world’s employment. Amidst these obvious numbers, there are several other reasons that make it important to support MSMEs. Let’s have a look at some of them.
50% of employment is produced and given out thanks to the job supply created by SMEs majorly. Job creation is one of the most essential factors of new businesses because they produce newer talents, roles, and requirements across different industries. As industries change and grow, job creation finds newer trajectories. For example, the pandemic created more digitally adaptable roles in many organizations that didn’t focus on those roles before. Therefore, to foster more job growth, MSMEs need maximum support.
One of the results of massive job creation is the consequent development of the economy. When the pandemic hit, many sectors went under and many people lost their jobs too. But MSMEs found the agility required in these circumstances and adapted to the changing circumstances of remote working and work from home necessities. Therefore, they played a huge role in maintaining the economies of various countries that struggled during covid. MSMEs have always played an integral role in economic building. Since they comprise 90% of businesses in total, this reason is self-explanatory. It is important for any economy to support its MSMEs because they are one of the sole generators.
Many financial institutions, national governments, and development banks are increasingly giving their support out to MSMEs because they are achieving the United Nations’ Sustainable Development Goals. Since MSMEs play such an important role in economic growth, they directly benefit the poor and vulnerable, especially women and youth. They reduce poverty by regularly generating income and have a huge positive impact on financially backward families. MSMEs, therefore lead to these households investing in education and health, everything fulfilling many SDGs. It’s becoming more important to support MSMEs everyday!
MSMEs often are the first ones to propel the transformation of technical innovations into demand-driven development solutions in most demographics. There is a strong equation between MSMEs and the generation of science, technology and innovations. Many scientific and technical innovations come from MSME entrepreneurs in most developing countries. MSME entrepreneurs have a lot of in-depth knowledge of the demands of local communities. Therefore, they have the ability to transform scientific and technical innovations into development solutions that can be replicated and increased. MSMEs are not only beacons of innovation, they also facilitate its expansion.
Therefore, supporting MSMEs is only in the best interest of all sections of society. They propel development, innovation, sustainable goals, income generation, and various other capitalization factors. That’s why most governments, institutions and banks are investing in the betterment of MSMEs, because they have a beacon of potential. Support MSMEs in your own ways, starting today!