A Country–Sector Framework for SME Economic Contribution: Evidence from Central and Eastern Europe

SMEs are often considered the backbone of Europe and their economic contribution is usually assessed in terms of performance measures like employment growth or innovation output. This research builds on a country–sector framework reinterpreting the economic contribution of SMEs as a structural phenomenon, determined by the turnover distribution across industries. The two complementary regression models estimated in this study map ten Central and Eastern European countries for the years 2021–2023, with data obtained from Eurostat Structural Business Statistics. The first model compares production and service sectors, while the second explores structural differences across detailed NACE industries. The findings show both statistically significant and sizeable economic differences in SME turnover among the sectors. SME turnover in the services sector significantly exceeds that in the production sector, with wholesale and retail trade emerging as the largest SME sector in all countries. A few sectors demonstrate persistently low SME turnover shares in the long term, suggesting scope for higher structural participation of SMEs. The results illustrate that SME economic performance is very concentrated in a few sectors and not evenly distributed. The study conceptually shifts the discussion from aggregate SME performance to structural economic composition that provides a sector-sensitive framework for SME policy and regional economic development.