Micro, small and medium enterprises (MSME) generate nearly half of the estimated $7.3 billion in revenue from the private non-agricultural sector, according to new research conducted by the Sir Arthur Lewis Institute for Social and Economic Studies (SALISES) of the Cave Hill Campus of the University of the West Indies.
In the past year going back to September 2015, SALISES surveyed 590 small businesses here in order to ascertain the contribution of MSMEs to the Barbados economy.
In releasing the survey results today at a stakeholders’ forum organized by the Small Business Association (SBA), Chief Executive Officer Lynette Holder suggested that the impact of small businesses should not be taken lightly.
The study found that MSMEs that are not involved in agriculture bring in $3.4 billion in revenue, accounting for about 48 per cent of private sector earnings, Holder said.
Breaking down the data, she said 2.7 per cent of this revenue came from micro enterprises; 23.2 per cent from small businesses and 21.5 per cent from medium-sized companies.
The greatest contributors are businesses in the service sector, which are responsible for 75 per cent of MSME non-agriculture earnings and 39.4 per cent of total revenue, she explained.
The small business executive also revealed that the micro and small enterprises contributed 51.4 per cent of gross domestic product and non-agriculture medium-sized businesses were responsible for 12.7 per cent.
The MSMEs were also found to account for 60.7 per cent of private sector employment and 47.6 per cent of total jobs across Barbados in 2015.
“The bulk of this employment is in small service companies, which accounted for 33.8 per cent of private sector employment and 26.5 per cent of total employment in the country,” the research found.
It estimated that 9,651 MSME were operating formally in Barbados, suggesting there were likely more, and they employ 100,449 people.
Overall, MSMEs also accounted for 38.8 per cent of total exports, with only 1.1 per cent coming from micro enterprises.
The SBA is observing Small Business Week this week with a number of activities, which began with a church service on Sunday at which President Dalton Medford said the organization would pressure Minister of Finance
Chris Sinckler to come good on his promise to provide $50 million in funding to the sector.