engleski

The influence of the business environment on the SMEs employment in the EU 28

Small and medium-sized enterprises (SMEs) in 2014 represent over 90% of enterprises in European Union countries in the non-financial business sector and employed almost 90 million people. They are the driving force behind a great number of innovations and lead to a development of the national economies through employment potential, value added, investments and internationalization. However, despite their importance to the vitality of the economy and the potential offered, too many significant economic barriers remain. Hence, the paper examines the influence of the business environment on the employment in SMEs of the EU member states, drawing on a panel dataset of 28 EU countries and over the period 2008-2014. The analysis is extended with the variables that can have a significant influence on the observed relationship, including the gross capital formation and production in the industry. The obtained empirical analysis suggests that further progress is essential through lower costs of starting a business and through stronger macroeconomic conditions, such as higher industrial production, higher investments and lower labour costs.

employment; small and medium sized enterprises (SMEs); doing business; European Union

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