Pandemic Effects on SMEs – Heterogeneity across Industries

Abstract

The study seeks to understand how small firms manage innovation and business development
during the Covid-19 pandemic. The empirical data consists of telephone interview with 1 200
SMEs and nine in-depth interviews with firms from the high technology and restaurant/hotel
industry. The analysis revealed that the basic conditions for firms are strikingly different in the
service sector compared to the manufacturing industry. The restaurant and hotel actors were
instantly and severely affected by Covid-19 and the negative effects of the pandemic applied
for a longer time despite intensive innovation work. The situation in high-technology firms
were radically different.