Resilience in the time of COVID-19: Lessons learned from Middle East and North Africa small- and medium-sized enterprises

Abstract

We investigated the effects of the COVID-19 pandemic on small- and medium-sized enterprises in Jordan, Egypt, Tunisia, and Morocco. Using firm-level panel data from an enterprise survey, we highlight several new findings. The surveyed firms resorted to wage and work hour reductions more readily than layoffs in the wake of the pandemic. Within these firms, larger firms are more resilient, recover faster, and adapt more often. On the sector level, the accommodation and food services sector is the worst affected by most outcomes. Furthermore, we find that switching to remote work is associated with better outcomes, while participating in government assistance programs is not. On the other hand, firms that participate in international trade are more resilient and adaptable during the pandemic. The results of the study carry policy implications relevant to the resilience of small- and medium-sized enterprises in developing countries in times of extreme crisis.