Background: The aim of this study is to investigate how employee engagement impacts the performance of small and medium-scale enterprises (SMEs) in Ghana. Specifically, it examines the relationship between employee engagement (cognitive, emotional and behavioural) and important performance dimensions such as productivity, profitability and employee retention. Design/methodology/approach: The research design adopted was quantitative and involved the use of structured survey questionnaire to get responses from 384 SMEs' employees/managers in Accra, Ghana. Data analysis was done by descriptive statistics, correlation analysis and multiple regression technique using IBM SPSS version 26. Findings: The findings show that employee engagement is a key positive factor of organizational performance. There are three dimensions of engagement: cognitive, emotional and behavioural, and they are all statistically significant predictors of firm performance. The results showed that emotional engagement was the strongest, which highlights the significance of psychological safety and organizational commitment in relation to performance outcomes in SMEs in Ghana. Research limitations/implications: The study has a cross-sectional design where the relationship between the variables cannot be clearly established, the data were collected from selected SMEs in Accra limiting the generalizability of results. Longitudinal designs and samples spread across more regions and sectors in Ghana should be considered for future research. Practical implications: SME owners and managers should implement structured engagement initiatives (such as recognition programs, participative management, and ongoing education) to build a highly engaged staff that will lead to better performance results. The strategies are especially significant in the context of resource limitations of SMEs in developing economies. Originality/value: This study is an empirical study on employee engagement and SME performance from a Sub-Saharan African context as it brings nuanced insights to the literature on employee engagement and SME performance on how the dimensions of employee engagement related to performance outcomes in a different way in resource constrained organizational contexts.