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Impact of the COVID-19 pandemic on entrepreneurs revealed in global study

Monday 31 May 21

Contact

Francesco Rosati
Associate Professor
DTU Entrepreneurship
+45 45 25 60 21

Contact

Nicola Anne Thomas
PhD student
DTU Entrepreneurship

Research seminar

If you want to know more about our study key findings, join us at our free research seminar.

Monday 7 June 2021 from 10:00 to 10:45 CET.

Sign-up here

Full study report

Francesco Rosati, Associate Professor at DTU Entrepreneurship, and Nicola Anne Thomas, PhD Student at DTU Entrepreneurship have been part of a global study on COVID-19 and entrepreneurship led by King’s College London and conducted on over 5,000 entrepreneurs in 23 countries. The study has documented the profound negative impact of the pandemic on entrepreneurs and small businesses globally. Yet the study also finds signs of optimism and resilience. 

Many entrepreneurs have seen their livelihoods threatened over the past year, and have been particularly impacted by the pandemic because they have fewer resources than large businesses. Whilst entrepreneurs are known for their agility, the significant challenges they have faced range from late paying customers to lack of access to government support. 

This was combined with the uncertainty and health-related worries, restricted social contact and support, all of which enhanced stress for entrepreneurs and diminished their mental well-being. But the research shows that, through entrepreneurs’ capacity to be resilient, over half of respondents can bounce back from adversity and cope with the setbacks, uncertainty, and stress that the pandemic entail.

Ute Stephan, Professor of Entrepreneurship at King’s College London comments: “Entrepreneurs are the backbone of the global economy, but it is only recently that we are starting to take their mental health seriously. Given the scale of the Covid-19 pandemic, understanding the experience of entrepreneurs in these difficult times as well as the outlook they have for what lies ahead are critical to sustain small businesses.”

How were entrepreneurs’ businesses affected by the pandemic

Some of the main findings in relation into how entrepreneurs’ businesses were affected by the pandemic include:

  • A staggering 61% of entrepreneurs saw the very existence of their business under threat due to a significant decrease in trading activities, although so far lay-offs only took place in 28% of SMEs. This means, nevertheless, that in the study sample alone, the jobs of 3,162 entrepreneurs and their 41,578 employees are at risk.
  • 42% of entrepreneurs increased remote working or newly started to work from home. 33% continued to work at their business’ premises, and 20% were already working from home before the pandemic. 
  • Entrepreneurs are known for their agility and this was also true during the COVID-19 pandemic: 68% of entrepreneurs surveyed adapted their plans for the business and almost 40% saw new business opportunities during the pandemic.

Francesco Rosati, Associate Professor in Sustainable Entrepreneurship and Innovation at DTU Entrepreneurship comments further: “Our study found that the jobs of many entrepreneurs and their employees are directly at risk. However, more than 40% of the entrepreneurs surveyed in Denmark saw new business opportunities during the pandemic, particularly in relation to digitalisation, sustainability, and health and well-being. Governments have now the opportunity – and responsibility – to strongly support visionary entrepreneurs working on these key trends and shape a more sustainable and resilient post-COVID-19 economy”.

Entrepreneurs’ stress and mental well-being during COVID-19

Some of the key findings in relation to entrepreneurs’ stress and mental well-being include:

  • Stress worsened during the crisis and entrepreneurs’ life satisfaction was on average 12% lower than before the pandemic.
  • Two fifths of entrepreneurs (40%) report high levels of uncertainty and unpredictability for their businesses.
  • Most entrepreneurs worry about their own and their family health (58%), fewer are worried about insufficient medical care (34% with substantial variation across countries).

Nicola Thomas, PhD Student at DTU Entrepreneurship comments: “It is clear that COVID-19 has posed a huge challenge for entrepreneurs across both Denmark and around the world. Entrepreneurs in Denmark reported higher levels of perceived stress than in non-pandemic times, with many reporting high levels of uncertainty. This highlights the need for inclusive government policies to ensure the prioritisation of support for entrepreneurs and small businesses across Denmark.” 

Full study report and global team behind

Download study report 
Global team behind the study 

Research seminar: Entrepreneurship during the COVID-19 pandemic

If you want to know more about our study key findings, join us at our research seminar on entrepreneurship during the COVID-19 pandemic (Monday 7 June 2021, from 10:00 to 10: 45 CET).

Sign up for online research seminar