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The sphere of entrepreneurship during the pandemic and the introduction of sanctions suffered significantly; there was an outflow of personnel from business, which requires radical and effective work with personnel and employment in the labor market. The performance indicators of national projects and the work of government officials depend on the situation with employment in business, the creation of proper working conditions, increasing wages and attracting the population to entrepreneurship. The study made it possible to assess the state and trends in the development of entrepreneurship in the country, assess the competitive advantages of companies, and the employment situation. To conduct the research, methods of grouping, comparison, analysis, construction of time series, and methods of constructive discussion were used. As a result of analyzing data on the number of SMEs, the turnover of enterprises, employed workers, and wages, criteria were identified that provide competitive advantages to small and medium-sized businesses locally in terms of attractiveness for employment. The authors outline prospects for increasing the competitiveness of small and medium-sized businesses. The priorities of the formation and implementation of state policy are set, which should be aimed at improving the provisions of the national project in the field of development and support of SMEs. The increase in theoretical knowledge in the process of research is the development of scientific and methodological approaches to the analysis of the entrepreneurship market from the standpoint of assessing its competitiveness for the country’s economy. For practice, the significance of the study is that it allows us to formulate conclusions for improving the tools for supporting and developing SMEs in the future.