Abstract:
This study analyses Small and Medium Enterprises and Job Creation for a panel of Rwandan
SMEs across manufacturing and all services sectors of the economy, using LRM (Linear
Regression Models) system to analyse a Panel data consisting of 453Rwandan SMEs enterprises
during 2006-2011.The conceptual framework is adopted and modified from Kristen,M and
Rogerson (2002);Munikrishnan & Verakumaran (2009).The model explains the relationship
between Labour productivity ,Size in terms of number of employees, Fixed assets, Female
owner, Manager experience, Region, machinery vehicle and equipment and Legal status of the
business which eventually leads to job creation. We aimed empirically exploring the linkage
between SMEs and Job creation in Rwanda.To reach objective, the panel data from census
conducted by World Bank for the period 2006-2011 used. Results indicated that size in terms of
number of employees, fixed assets, Machinery vehicle and equipment, Region of the business
significantly contributed to job creation in SMEs .However, female owner, Labor productivity
and manager experience were found to be insignificant on job creation in SMEs in Rwanda.
Even though Small Enterprises were aware of government incentives do not create Job.
