Journey to Recovery and the Next Normal for Philippine MSMEs

The evolution of the COVID-19 crisis has brought unprecedented uncertainty more than one year into the pandemic. Although mobility restrictions have gradually eased and vaccination roll-out has started to pick up, institutions such as public health have continued to face immense pressure from the emergence of more threatening variants. Supply-side and demand-side shocks have ravaged the small business sector, comprised of micro, small, and medium enterprises (MSMEs). The pandemic has changed the landscape for MSMEs. New challenges have emerged for small businesses in the Philippines amidst the growing uncertainty about the next normal.This report tracks the recovery journey of 677 MSMEs in the National Capital Region (NCR) and the neighboring CALABARZON region in the Philippines, more than one year into the COVID-19 pandemic. Our study focuses on firms’ performance, strategies, and coping mechanisms from the beginning of the pandemic to April 2021 to assess how firm adaptations to the new market environment have evolved and how this may have affected performance and their evolving business strategies