Key features in resilience to COVID-19 among businesses in Mexico

What is it about?

This study examines what features made businesses struggle financially during the COVID-19 pandemic. By analyzing the data from 754 businesses collected in a randomized survey, our study found that certain factors increased the risk of financial trouble. Businesses that laid off workers were 2.9 times more likely to consider closing. Micro companies faced two times higher risk, and those under five years old had a 1.5 times higher risk. Companies led by women and those that saw a drop in sales in 2021 were also more likely to struggle. Finally, asking for government aid implies 1.9 times higher odds of entertaining the idea of closing the business for good. The study suggests that disaster relief programs should focus on helping businesses with these characteristics. This research helps understand the specific challenges micro businesses faced during the pandemic.

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Photo by Anton Sobotyak on Unsplash

Photo by Anton Sobotyak on Unsplash

Why is it important?

This is important because it can be used to be better prepared for the next cash shortage crisis and can direct innovative practices towards the ones that were successful, in sum, you can learn from the experiences of companies that navigated the COVID-19 pandemic.