SME viability in the COVID-19 recovery.

Abstract: Using survey data from a representative sample of Irish Small and Medium Enterprises (SMEs), we study how firms are likely to perform under macroeconomic forecasts of the pandemic recovery. The rate of financial distress among firms is expected to fall under baseline forecasts from a peak of 12% in 2020 to 7% by 2024. We find that those firms that struggle to recover by the end of our scenario window were mostly unprofitable or distressed prior to the pandemic.