ILO advocates stronger support for MSMEs amid global economic pressures

• Says small businesses create two out of every three jobs worldwide

THE director-general of the International Labour Organization (ILO), Mr Gilbert F. Houngbo, has called for renewed global support for micro-, small and medium-sized enterprises (MSMEs), warning that millions of businesses are grappling with mounting economic, geopolitical and climate-related challenges, despite remaining the backbone of economies worldwide.

In a statement marking the 2026 International MSME Day, Houngbo said governments, employers and workers’ organisations, financial institutions, development partners and the private sector must work together to create an enabling environment that allows small businesses to grow, innovate and create more decent jobs.

Describing MSMEs as the engine of economic growth and social progress, the ILO director general noted that they account for more than 90 percent of businesses globally and provide two out of every three jobs.

“MSMEs are at the heart of our economies and societies. They represent more than 90 percent of businesses worldwide and create two out of every three jobs. They generate opportunity, drive innovation, strengthen local economies, and contribute directly to sustainable development and social progress,” he said.

Houngbo, however, warned that the sector is operating under increasing pressure from economic uncertainty, geopolitical tensions, climate-related shocks, persistent inequalities and tighter financial conditions.

He added that businesses are simultaneously being required to adapt to rapid technological, digital and green transitions.

“These challenges are real. But so are the opportunities,” he said, stressing that new technologies and digital innovation could help MSMEs become more productive, resilient and competitive if they are given the necessary support.

According to him, digital tools can expand access to markets, improve business performance and open new opportunities for growth, but cautioned that many enterprises, particularly those in developing countries, rural communities and businesses led by women and young entrepreneurs, risk being left behind without deliberate interventions.

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The ILO chief said enterprise growth and social justice must go hand in hand, insisting that thriving MSMEs require an enabling business environment supported by sound policies, effective institutions, access to finance, infrastructure, markets and a skilled workforce.

“This is why the ILO continues to place MSMEs at the centre of its vision for inclusive and sustainable development. We know that enterprise success and social justice go hand in hand,” he said.

He also underscored the importance of decent work, saying resilient and sustainable enterprises depend on safe and healthy workplaces, respect for labour rights, sustainable social protection and strong social dialogue.

“Decent work is not only a social objective—it is also a foundation for enterprise resilience, productivity and long-term success,” Houngbo stated.

The Director-General called for renewed partnerships to unlock the full potential of MSMEs, urging governments and stakeholders to expand access to affordable finance, strengthen digital infrastructure and skills, promote innovation, support business formalisation and remove unnecessary barriers to enterprise development.

He said such measures would enable MSMEs to participate more effectively in local and global markets while contributing to inclusive economic growth.

“Today, we need renewed action and stronger partnerships,” he said.

On the significance of the annual observance, Houngbo celebrated the millions of entrepreneurs, employers and workers whose innovation, commitment and talent continue to drive the success of small businesses across the world.

“On this International MSME Day, let us reaffirm our commitment to building economies that are more resilient, more inclusive and more sustainable.

“Because when MSMEs thrive, create decent work and contribute to shared prosperity, societies move forward,” he added.