The European Restructuring Monitor (ERM) annual report for 2015 explores the issue of job creation in small and medium-sized enterprises (SMEs). SMEs are increasingly recognised as a job engine for Europe. However, given the heterogeneity of the vast SME population, not all contribute equally to employment growth. This study seeks to identify which SME types are more or less dynamic job creators and to determine their main drivers and barriers for job creation. It also examines recruitment in SMEs, the extent of public debate on job creation in SMEs, and public support instruments available to SMEs that encourage them to create jobs. The study finds that SMEs that tend to create jobs are often young, innovative, internationally active, located in urban areas and run by skilled managers with the capacity to plan and realise active growth and investment strategies. However, a combination of both external and internal company factors, rather than individual characteristics, determines the job creation potential of these companies. An executive summary is available - see Related content.