STATE SUPPORT FOR SMALL AND MEDIUM-SIZED ENTERPRISES IN PANDEMIC PERIOD: EVIDENCE FROM SLOVAKIA

Abstract

In the past two years, the world had to face and fight against the new infectious respiratory disease – COVID-19. Shortly after the emergence of the disease, it had become declared a pandemic by the WHO (World Health Organizations). Millions of deaths were reported caused by the pandemic, affected were different age groups of people. In addition to the decline of the health situation, the pandemic had significant impact on the functioning of the social and economic mechanisms. COVID-19 also influenced the situation on the labour market. It had negative impact on the SME sector worldwide. This trend applies in Slovakia as well, where introduction of home office proved to be a sensible solution in order to minimize the physical presence and contact of the employees, especially in the sectors where home office was a possible solution. Teleworking is a work done away from the office/site, so the work is done using information and communication technologies. The main goal of this study to present the impact of COVID-19 on the Slovak labour market, which focuses on transition to remote work (home office). At the same time, the state introduced several forms of subsidies to ease the burden of entrepreneurs. This study is addressing the question to what extent the small and medium-sized enterprises in Slovakia utilized the subsidy schemes introduced by the state. We put special emphasis on the service sector. The theoretical background of the study is based on the summary of the relevant scientific literature, which is followed by the presentation and introduction of secondary data. Since the amount of collected data is limited, we focus on the presentation of data from 2020. Secondary data are collected using relevant databases of Eurostat, OECD, Statista, the Slovak Business Agency, Association of Hungarian Entrepreneurs in Slovakia and the Ministry of the Economy of the Slovak Republic (MH SR). The SME sector is the biggest victim of the economic crisis caused by the epidemic, with 9.8% of businesses closed due to the hopeless situation. With the introduction of Lex Corona 2020, the Slovak government has sought to preserve jobs, keep businesses alive and prevent negative effects. In Slovakia, the proportion of people working from home increased by 2% compared to the period before the coronavirus epidemic, while workers were satisfied with the technological conditions and quality of their work at home. The government has prioritized support for industry, while the service sector and trade have benefited from only 20% of state support. All in all, businesses in the service sector and trade were dissatisfied with the support provided to them. The results of the research and the conclusions and findings of the data analysis can provide useful information for researchers working in a similar field as a result of the pandemic and for those interested in the SME sector.