Serbian SME’s Still Represent a Potential for Overall Economic Development

Abstract

Although late, economic development of Serbia prior to the Global economic crisis was relatively fast, comparing to other transitory economies. Small and medium scale enterprises (SMEs) had also fast growth and become important economic subject. The Global economic crisis has negatively influenced the national economy from late 2009, including SMEs. Those companies and shops are on the low level of international competitiveness, as a consequence of process of de – industrialization and slow process of restructuring. In order to get better look into labor productivity driving forces an analysis was performed through regression framework, while the analyses, performed for EU countries was used as a benchmark. Those results pointed that labor productivity growth of Serbian SMEs during recession years was results of decreasing employment and not from expansion. It also pointed that export growth and investments growth are important for increase in labor productivity. Improving labor productivity is essentially important for increasing international competitiveness of Serbian SMEs. It is very complex issue from analytical point of view and improvement in data basis and analytical methodology would be useful, especially for decision makers and policy makers also