Impact of COVID-19 Pandemic on Financial Health of SMEs

European governments, in order to limit the spread of the COVID-19 pandemic, adopted restrictive measures in the early 2020. These measures were aimed at restricting business operations and the free movement of individuals. These restrictions significantly worsened business situation of thousands of small- and medium-sized enterprises. Compared to large companies, small- and medium-sized enterprises generally possess limited human and financial capital and it is more difficult for them to survive longer periods of lockdown or partial lockdown with limited or no income. The aim of this manuscript is to analyse the impact of the COVID-19 pandemic on the financial health of small- and medium-sized enterprises in Slovakia. Analysis was performed on a sample of 109,340 small- and medium-sized enterprises from Slovakia by comparison of selected financial indicators for the pre-COVID year 2019 and the COVID year 2020 on a sector level. The identification of statistically significant differences was performed by the Kruskal–Wallis test (nonparametric ANOVA). Results indicate that the most COVID-affected sectors were construction, food processing industry, law, consulting and accounting, retail, services and tourism and gastronomy. Impact of COVID restrictions was observed by worsened indicators of debt and profitability, while the liquidity indicators did not worsen compared to the 2019 levels.