Seoul: The combined sales of South Korea's small and midsized enterprises (SMEs) experienced a slight decline in 2023 compared to the previous year, marking the first drop in four years, as indicated by a government report released on Friday.
According to Yonhap News Agency, the Ministry of Small and Medium-sized Enterprises and Startups published an annual report showing that the number of SMEs reached 8.3 million at the end of 2023, reflecting a 3.2 percent increase, or 256,000 additional enterprises, from the previous year. As of the end of 2023, SMEs employed 19.12 million people, representing a 0.9 percent rise from the prior year. Despite this growth in numbers and employment, their combined sales fell to 3,301.3 trillion won (US$2.38 trillion), down 0.2 percent from the previous year.
This downturn marked the first year-on-year decline since 2020, following a steady growth trajectory from 2,675 trillion won in 2020 to 3,017 trillion won in 2021, and reaching 3,309 trillion won in 2022. SMEs constituted 99.9 percent of the nation's total enterprises, contributed to 80.4 percent of employment, and accounted for 44.9 percent of total sales.
Sector-wise analysis revealed that SMEs in finance and insurance experienced a significant sales increase of 17.9 percent on-year, while those in accommodation and food services saw an 8.7 percent rise. Conversely, sectors such as manufacturing and wholesale recorded declines. Employment trends varied, with hotels and restaurants increasing their workforce by 2.5 percent compared to the previous year, whereas the transportation and storage sector saw a 4.6 percent reduction in jobs.