The Role of Innovation Capability in MSME Sustainability During the Covid-19 Pandemic

Micro, Small, and Medium Enterprises (MSMEs) are business activities capable of expanding employment providing the economic services for society widely, also play roles in equalizing increasing people's income, encouraging growth, realizing national stability. Small an essential role improving community's economy at city regency levels. This study aims to analyze empirical evidence that capabilities environmental factors carried out by MSMEs have a positive effect on innovation, both product innovation process innovation. The method used this is Structural Equation Model PLS analysis. population total number which registered with Department Trade Industry 2020 as many 31591 businesses. data collection technique done distributing questionnaires. Measurement models assessed testing reliability each item, converging validity discriminant validity. results analysis show capability MSME sector significant concludes can increase impact sustainability MSMEs. contribution research made