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Executive Summary
Introduction
Through the changing economic conditions brought about by the pandemic, the
Department of Trade and Industry (DTI), through the Bureau of Small and Medium
Enterprise Development (BSMED), the Regional and Provincial Offices under the
Regional Operations Group (ROG), and the Bureau of Trade and Industrial Policy
Research (BTIPR), with the support of the Knowledge Management and Information
Service (KMIS) under the Management Services Group (MSG), has conducted a
series of impact assessment surveys of COVID-19 on the micro, small, and medium
enterprise (MSME) sector to determine how the changes affect MSMEs’ business
operations and their immediate needs as the countryis placed under varying levels of
community quarantine.
Early this year, three (3) survey rounds were conducted to gauge the MSME sector’s
continued adaptation to the pandemic and restriction policies. To follow through with
the monitoring of MSMEs’ conditions, another survey round was conducted for
September 2021.
Objectives
The survey aimed to identify the effects of the COVID-19 pandemic quarantine
measures on MSMEs during the 16 to 30 September period under study:
Methodology
Existing clients of the Department, including those of its attached agencies and other
program and development partners, with records under the Client Profile and
Monitoring System (CPMS), Knowledge Connect Project, and those in the databases
of Kapatid Mentor ME (KMME), MSME Summit, RapidPass, industry associations, the
Philippine Chamber of Commerce and Industry (PCCI), and DTI Regional and
Provincial Offices, among others, were invited to participate in the survey.
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Region Target Respondents
NCR 342
CAR 34
Region 1 92
Region 2 53
Region 3 196
Region 4A 248
MIMAROPA 39
Region 5 68
Region 6 102
Region 7 116
Region 8 51
Region 9 57
Region 10 62
Region 11 94
Region 12 76
Caraga 34
TOTAL 1,664
Salient Findings
1. Profile of Respondents
o A total of 1,636 MSMEs responded to the survey. Of the total, 342 or 20.9%
are from NCR and 1,294 or 79.1% are from the rest of the regions.
o All regions met their target number of respondents, except for Region 4A
which garnered only 89.9% of their target.
o 467 or 28.5% are engaged in the wholesale and retail trade sector.
o 1,026 or 62.7% of the business owners are female. Of the female business owners,
86.2% are owners of micro enterprises in asset size.
o Full Operation
o Partial Operation
o Effect on Sales
o Effect on Workforce
• 54.8% of the MSMEs outside the NCR area reported their workforce
remained the same. While decreased workforce were at 39.4% and
increased workforce was at 5.8%. The highest number of enterprises
that reported their workforce remained the same outside the NCR
area was the wholesale and retail trade industry.
o About 61.1% of MSMEs that closed reported only temporary closure with
the intention to reopen when business conditions improve, while 25.7%
were forced to close in compliance with government regulations, and 13.3%
permanently closed with no intention to reopen.
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Recommendations
Based on the results of the survey, the following policy recommendations are thus
made:
1. Continue the safe reopening of the economy with measures such as easing age
restrictions and allow freer mobility of persons, especially in the NCR, to address the
greater effect on workforce in the NCR area;
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Survey Results
I. Profile of Respondents
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II. Status of Operations
In the NCR area, there are 59.4% of MSMEs that are partially operating from
the period 16 to 30 September. For the rest of the country, a similar 50.9% of
enterprises are partially operating for the period 16 to 30 September. The
industry with the highest number of enterprises under stopped operations is
the other service industry at 38.9%.
c. Declared reason for stop operations. The most common reason cited by
respondents who temporarily stopped operations is depleted working capital.
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Reason for Stop Operations No. of %-
Respondents share
Depleted working capital 42 44.7%
Sales declined 23 24.5%
Difficulty in sourcing raw materials 12 12.8%
Under industry that is not allowed to
3 3.2%
operate
Others 14 14.9%
TOTAL 94 100.0%
During the same period in the NCR area, both small-sized and medium-sized
enterprise respondents were fully operating; while majority of the micro-sized
enterprises reported to be partially operating. Across all asset sizes, stop
operations has the least number of enterprises.
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Majority of medium-sized enterprises outside of the NCR were fully operating
during the 16 to 30 September period, while most micro-sized and small-
sized enterprises were partially operating. Across all asset sizes, stop
operations has the least number of enterprises.
NCR
Nationwide
0 100 200 300 400 500 600 700 800 900 1000
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b. By Asset Size. Nationwide, MSMEs reported a decrease in sales regardless
of asset size. Similarly, enterprises within the NCR indicated a decrease in
sales regardless of asset size for the period 16 to 30 September.
For areas in the rest of the regions, many MSMEs reported that sales decreased,
regardless of asset size.
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Effect on Sales by Industry Increased Decreased Remained Total
(NCR) the same
Other Service 8 73 25 106
Manufacturing 8 56 8 72
Wholesale and retail trade 7 46 17 70
Accommodation and food
4 47 5 56
service
Finance - 1 1 2
TOTAL 27 223 56 306
In NCR, the industry with the biggest comparative decrease in sales is the
accommodation and food service industry at 83.9%. Outside the NCR, all
industries reported their sales remained the same.
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MSMEs within NCR indicated a decrease in workforce regardless of asset
size. Meanwhile, for the rest of the regions, most micro-sized enterprises
reported that workforce remained the same. Both small-sized and medium-
sized enterprises decreased in workforce.
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Effect on Workforce by Increased Decreased Remained Total
Industry the same
(Rest of the Regions)
Wholesale and retail trade 18 105 254 377
Manufacturing 23 127 150 300
Accommodation and food
13 138 105 256
service
Finance 3 12 22 37
Other Service 15 97 135 247
TOTAL 71 479 666 1,217
c. Effect on Workforce within NCR and the rest of the regions. For the period
16 to 30 September, many enterprises have retained their workforce size
regardless of location.
V. Business Direction. 39.5% half of the respondents intend to adopt online selling
as an alternative marketing strategy, with a close 34.7% reporting they intend to
continue current level of operations.
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Type of assistance Total %-share
Technology upgrading 460 32.3%
Financing assistance 363 25.5%
Compliance with government regulations 338 23.8%
Marketing assistance 151 10.6%
Skills/management training 111 7.8%
VII. Government Measures to Open the Economy. Ease of age restrictions, freer
mobility of persons was the highest ranked recommendation of MSMEs to open
the economy. Enforcing implementation of minimum public health standards and
increasing operational capacity of establishments also ranked in the top three
recommendations.
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Results by Region
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Region Wholesale Manufac- Accommodation Finance Other Total
and retail turing and food Service
NCR 77 79 64 2 120 342
CAR 5 11 7 2 9 34
Region 1 41 16 19 1 15 92
Region 2 11 14 15 1 12 53
Region 3 57 53 36 12 38 196
Region 4A 84 51 24 4 57 220
MIMAROPA 23 0 11 0 5 39
Region 5 10 38 8 1 11 68
Region 6 27 25 27 0 23 102
Region 7 23 34 35 2 22 116
Region 8 13 7 15 5 11 51
Region 9 17 12 19 1 8 57
Region 10 11 18 16 3 14 62
Region 11 26 16 23 0 29 94
Region 12 34 9 21 3 9 76
Caraga 8 8 7 3 8 34
TOTAL 467 391 347 40 391 1,636
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Region Increased Decreased Remained Total
the same
NCR 20 160 126 306
CAR 1 12 18 31
Region 1 4 17 60 81
Region 2 3 11 32 46
Region 3 8 98 78 184
Region 4A 18 65 121 204
MIMAROPA 0 12 27 39
Region 5 3 30 33 66
Region 6 6 48 43 97
Region 7 10 42 61 113
Region 8 5 14 32 51
Region 9 1 19 32 52
Region 10 1 30 27 58
Region 11 2 42 42 86
Region 12 5 28 42 75
Caraga 5 11 18 34
TOTAL 91 639 792 1,523
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Annex A:
Comparative Table for the Survey Rounds (1st – 8th)
Asset Size
Micro 2,481 1,800 3,650 2,619 14,402 22,721 31,568 1,326
Small 367 272 314 234 766 879 1,184 103
Medium 92 70 149 145 266 487 393 207
Large 0 29 100 55 0 0 0 0
TOTAL 2,940 2,171 4,213 3,053 15,434 24,087 33,145 1,636
Employee Size
Micro 2,495 1,825 3,691 2,630 14,480 - - -
Small 395 301 374 318 809 - - -
Medium 26 17 55 50 145 - - -
Large 24 28 93 55 0 - - -
TOTAL 2,940 2,171 4,213 3,053 15,434
Industry Sector
Wholesale and
791 529 1,608 1,285 8,297 14,733 19,560 467
retail trade
Manufacturing 1,143 728 1,072 719 2,552 2,604 2,975 391
Accommodation
305 237 562 350 1,680 2,183 4,290 347
and food service
Finance and 40
14 16 25 15 76 163 559
insurance
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Survey Options Survey Round
1st
2nd
3 rd
4th 5th 6th 7th 8th
Other services 687 661 946 684 2,829 4,404 5,761 391
TOTAL 2,940 2,171 4,213 3,053 15,434 24,087 33,145 1,636
Status of
Operations
Full 582 491 1,990 1,669 8,711 12,769 19,420 661
Partial 1,544 1,296 1,990 1,237 6,061 10,391 12,759 862
Stop 814 384 233 147 662 927 966 113
TOTAL 2,940 2,171 4,213 3,053 15,434 24,087 33,145 1,636
Effect on Sales
Increased 96 66 1,063 323 4,760 1,409 1,688 171
Decreased 1,919 1,610 2,744 1,868 6,425 5,974 941
Remained the 10,012
111 111 173 715 15,326 24,505
same 411
TOTAL 2,126 1,787 3,980 2,906 14,772 23,160 32,167 1,523
Effect on
Workforce
Increased 51 16 817 105 1,208 742 703 91
Decreased 1,591 1,249 2,651 1,140 4,316 3,584 639
Remained the 13,564
484 522 512 1,661 18,102 27,879
same 792
TOTAL 2,126 1,787 3,980 2,906 14,772 23,160 32,166 1,522
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Annex B:
4. Health Protocols
• Ease of health protocols for businesses; assistance in compliance with
health protocols eg. provision of PPEs, etc.
• Assistance on the provision of vaccines.
2. Expansion
• Expansion of clients/projects (branching out, widening network, etc.)
III. Financing
1. Loans (Grants, Processing, Low Interest Rates)
• Financial grants and assistance from the government.
• Ease of acquiring loans from SB CORP/DTI
IV. Technology
1. Provision of Machinery and Equipment
• Provision of advanced equipment
V. Marketing Assistance
1. Market Platforms
• Assistance in development/funding of Facebook ads, online selling
platform opportunities.
2. Sales Stimulation
• Linkages with suppliers in our province and other provinces as well.
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VI. Others
• Re-opening of the economy
• HR employment; recruitment assistance
• Government administration concerns
• Opening of strictly regulated industries; tourism, spa/wellness, among
others.
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