ECONOMIC RECESSION AND PERFORMANCE OF SMALL AND MEDIUM SCALE ENTERPRISES (SMEs)
ABSTRACT
The aim of this study is to determine the extent to which economic recession affects SMEs operational activities in Edo State and identify the impact of such economic downturn on their profitability, productivity, turnover, liquidity and employment practices. The study used a sample of 100 owners of Small and Medium Scale Enterprises (SMEs) in Benin City, Edo State, Nigeria. The sample was arrived at using a convenience non random sampling technique. This is because the sampling frame is unavailable.
Apart from descriptive analyses, the study used the Pearson Product Moment Coefficient of Correlation to ascertain if there is a relationship between SMEs productivity and economic recession, SMEs sales and economic recession, SMEs employment rate and economic recession, SMEs product patronage and economic recession. The study revealed that there is an inverse relationship between economic recession and the productivity of Small and Medium Scale Enterprises, negative relationship between Economic Recession and the level of actual & anticipated turnover and consumer patronage and economic recession are moderately correlated, their relationship is actually negative.
Thus, we recommend that small and medium scale businesses should Small and Medium Scale Enterprises (SMEs) management should endeavor to invest intensively in innovative processes and technologies that will significantly cut overall production costs and result in lower product prices but same or higher quality; constantly monitor their environment to instantaneously pick up significant changes that will likely affect the business and) should occasionally seek the advice of expert consultants in managing critical business issues in order to reduce the impact of the recession.
TABLE OF CONTENTS
CHAPTER ONE: Introduction
Background to the Study    -    -
Statement of the Problem    -    -
1.3.     Research Questions    -    -    -    
1.4      Objectives of the Study    -    -
1.5.    Research Hypothesis    -    -    -
1.6   Scope of the Study    -    -    
1.7    Significance of the Study    -    -    
CHAPTER TWO: Literature Review
2.1       Introduction    -    -    -    
2.2     Concepts of Economic Recession    -
2.4      Empirical Review    -    -    -    
2.5     Theoretical Review    -    -    
CHAPTER THREE: Methodology
Introduction    -    -    
3.2 Research Design    -    -    -    -
3.3 Population of the Study    -    -    -
 Sample and Sampling Technique    -    -    
3.5    Model Specification    -    
3.6   Operationalization and Measurement of Variables
3.7  Research Instrument    -    -    
3.8   Validity and Reliability of Instrument    -    
3.9    Method of Data Analysis    -    -
CHAPTER FOUR: Data Presentation and Analysis
  Introduction    -    -    -    -    
4.2   Description of Background Information    -    
4.3   Test of Hypotheses    -    
4.4      Economic Recession and SMEs Operational Activities
4.5    Discussion of Findings    -
CHAPTER FIVE: Summary, Conclusion and Recommendations
5.1    Introduction    -    -    
5.2    Summary of Findings    -    -    -    -
5.3    Conclusion    -    -    -    -
5.4    Recommendations    -    -    -
5.5        Further Studies    -    -    
CHAPTER ONE
Introduction
Background to the Study
According to Meriam-Webster (2008), Economists officially define a recession as two consecutive quarters of negative growth in Gross Domestic Product (GDP). According to the National Bureau of Statistics, Nigeria is currently experiencing economic recession after -0.36% growth in GDP (Gross Domestic Product) in the first quarter of 2016 and -1.5% growth in GDP (Gross Domestic Product) in the second quarter of 2016. The Nigerian situation has been tagged feeble due to the negative effects the global economic meltdown has had on the country. Every industry has had its fair share of the troubles and companies are licking their sores with resultant effects on the masses. Adebayo (2006), Economic recession is a period of economic slowdown featuring low output, illiquidity and unemployment. It is characterized by its length, abnormal increases in unemployment, falls in the availability of credit, shrinking output and investment, numerous bankruptcies, reduced amounts of trade and commerce, as well as highly volatile relative currency value fluctuations, mostly devaluations, financial crises and bank failure. Therefore, the thrust of this study investigates the nexus between economic recession and SMEs (small and medium scale enterprises) operational activities in Edo State.
All over the world small and medium enterprises are considered as the backbone of a country’s economy (Smirat, 2016). They play a key role in economic development and make an important contribution to employment and gross domestic product and are important contributors to total employment. The role of Small and Medium scale Enterprises (SMEs) in the world economy have been emphasized as the means through which rapid industrialization and other goals of a nation can be realized (Smirat, 2016).  
This sector is responsible for about 70 per cent of the total industrial employment in Nigeria and between 10-15 per cent of the total manufacturing output (cassavamillers.com). The agricultural sector which comprises mainly of SMEs have promoted indigenous technology and increased utilization of local raw materials. They are the strongest promise we have for industrial growth.
Statement of the Problem
Promoters of small and medium enterprises are people with ideas, dreams and imaginations but majority of the entrepreneurs lack the needed financial means to translate their dreams and aspirations into concrete that will earn them the desire wealth (Aremu, 2004). Small and medium enterprise experiences difficulties in raising equity capital from the finance houses or individuals. Even when the finance house agrees to provide equity capital, the conditions are always dreadful.  All the result to inadequate capital available to the sector and thus lead to poor financing. This is the bane of most cottage industries in Nigeria. About 80% of small and medium enterprises are stifled because of this problem of poor financing and other problems associated with it (Aremu, 2004). The problems that emanated from poor financing include: Lack of competent management which is the consequence of inability of owners to employ the services of experts, use of obsolete equipment and methods of production because of owner’s inability to access new technology, excessive competition which resulted from sales which is a consequence of poor finance to cope with increased competition in the industry.
The Nigerian economy which is currently experiencing economic recession (characterized by abnormal increases in unemployment, falls in the availability of credit, shrinking output and investment, numerous bankruptcies, reduced amounts of trade and commerce, as well as highly volatile relative currency value fluctuations, mostly devaluations, financial crises and bank failure), may have a significant effect on SMEs performance(Adebayo,2006).
Therefore, the need for a study that will determine the extent to which economic recession affects SMEs operational activities in Edo State.
1.3.     Research Questions
       In the light of the stated problem of the study, the following research questions are relevant:
What is the relationship between Small and Medium scale Enterprises(SMEs) productivity and economic recession?
What is the relationship between SMEs sales and economic recession?
What is the relationship between SMEs employment rate and economic recession?
What is the relationship between SMEs product patronage and economic recession?
1.4     Objectives of the Study
Following the research questions, the objectives of the study will be to:
Examine the relationship between Small and Medium Scale Enterprises(SMEs) productivity and economic recession
2.    Determine the relationship between SMEs sales and economic recession
3.    Ascertain the relationship between SMEs employment rate and economic recession
4.  . Determine the relationship between SMEs product patronage and economic recession
1.5.        Research Hypothesis
The hypotheses that will be tested in this study are as follows and they are stated in null form:
1.  Ho:  There is no significant relationship between Small Medium scale Enterprises (SMEs) productivity and economic recession.
2.   Ho:  There is no significant relationship between SMEs sales and economic recession.
3.  HO:     There is no significant relationship between SMEs employment rate and economic recession.
4. HO:     There is no significant relationship between SMEs product patronage and economic recession.
1.6   Scope of the Study
In order to ensure that a research investigation is directed and focused, every study has its own boundaries (Agbonifoh & Yomere, 1999). Recession in terms of SMEs production, sales, employment rate and patronage. To this end, the scope of a study may be defined geographically, temporarily, and in terms of subject. This study would cover selected SMEs such as bakery, barbing salon, restaurants, hotels amongst others in Benin City, Edo state, Nigeria.
1.7    Significance of the Study
This study tends to look at the performance of SMEs economic recession period in Nigeria. This study will enhance the profitability of small and medium enterprises by showing the nexus between economic recession and SMEs (small and medium scale enterprises) performances in Edo State. This study will also benefit Academicians and other researchers.