Kazakhstan SME employment drops 9.3% to 3.92 million
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The number of people employed by small and medium-sized businesses in Kazakhstan fell by 403,000, or 9.3%, to 3.92 million in the year to April 1, 2026, according to the Bureau of National Statistics. The decline was partly driven by individual entrepreneurs transitioning to a new tax regime for the self-employed introduced at the start of 2026. Nominal SME output rose 4.3% to 19.5 trillion tenge in the first quarter, but real output fell 6.6% after adjusting for inflation.
SME Employment Decline
The number of active SME entities fell 1.5% to 2.07 million, while registered entities dropped 2.4% to 2.24 million. Individual entrepreneurs account for 70% of all active subjects. The Bureau of National Statistics noted that the shift of some individual entrepreneurs to a new tax regime for the self-employed, effective from January 2026, contributed to the decline.
Output and Sector Trends
SME output reached 19.5 trillion tenge in Q1 2026, with nominal growth of 4.3% but a real contraction of 6.6% after accounting for inflation. Trade remains the dominant sector, providing nearly a third of output and employment. Industrial output grew approximately 30%, while construction output fell almost 35%. The SME share of GDP held steady at 38.7%, versus 38.6% a year earlier.
Regional Concentration and Innovation Gap
Almaty and Astana together generated 45% of all SME output, contributing 5.1 trillion and 3.7 trillion tenge respectively. Technology adoption remains low: only 9.8% of small enterprises report innovation activity, compared to 17.7% of medium-sized firms and 34.2% of large companies. Separately, deputies have warned that new public procurement rules could squeeze SME suppliers, though the government dismissed those concerns as a simple alignment with the Tax Code.
What's Next
The government is expected to clarify procurement rules affecting SME suppliers, while the new self-employed tax regime continues to reshape the business landscape. Whether the real output contraction signals a lasting downturn for small enterprises remains uncertain as inflation and structural shifts persist.
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Kazakhstan SME employment drops 9.3% to 3.92 million
