"Support Policies for Women Construction Companies Must Enhance 'On-Site Perception'"

Geonsanyeon "Expansion of Preferred Construction Scale for Business Conditions, Public Institutions' Purchase Target Ratio Should Apply 5% Equally to 'Construction' Without Discrimination"

Photo by Moon Honam munonam@

[Asia Economy Reporter Kim Yuri] "Despite the expansion of government support policies for women-owned businesses, the practical effectiveness of support policies perceived by women-owned construction companies is low."

The Korea Construction Industry Research Institute pointed this out in its research report titled "Measures to Enhance Support for Expanding the Role of Women-Owned Businesses in the Construction Industry" on the 21st.

The institute explained that with the recent changes in the nature of the construction industry and production methods due to the Fourth Industrial Revolution, the activities of women-owned construction companies are expected to increase; however, the actual role of women-owned construction companies remains minimal compared to other industries. The analysis suggests that this is due to the low perceived effectiveness of government support policies.

According to a survey conducted in December last year by the Ministry of SMEs and Startups and the Women’s Enterprise Support Center, among eight support policies for women-owned businesses, less than 50% of approximately 7,500 responding women-owned construction companies answered that they were "well aware" of tax support, technical support, and market access support policies. Regarding the question on utilization effectiveness, about 97% responded that they had "never used" these supports. In particular, for market access support, 45.9% of responding companies were unaware of it, and 97.3% had never used it. Only 33.3% responded that it was useful.

The number of women-owned companies in general construction is 1,671, accounting for 13.9% of all general construction companies. 76.2% (as of 2017) are located in provincial areas, and 95% are small-scale companies rated grade 6 or below (with a market price of 20 billion KRW or less). The average annual contract amount per company is about 3.5 billion KRW, which is only 23% of the average for general construction companies. Regionally, 23.8% are distributed in the Seoul metropolitan area, and 76.2% in provincial areas. The region with the highest proportion of women-owned companies among general construction companies is Gangwon-do (23.5%), followed by Jeonbuk (21.5%), Daejeon (16.4%), and Daegu (14.1%). An analysis of the 2017 contract amounts of women-owned general construction companies showed that 27.0% of companies had no contract amount from public construction projects.

Senior Research Fellow Kim Min-hyung of the Korea Construction Industry Research Institute argued that to expand the role of women-owned businesses in the construction industry, it is necessary first to enhance the effectiveness of existing support systems. He pointed out, "In advanced countries such as the United States and Japan, goods, services, and construction are not separately distinguished, and at least 5% of government procurement contracts are allocated to women-owned businesses. However, in Korea, the public institution purchase target ratio for 'construction' is set at 3%, which is lower than the 5% for goods and services." Due to the low purchase target ratio, the usefulness evaluation of market access support systems by women-owned construction companies is 33.3%, significantly lower than the overall average of 62.8% for women-owned businesses.

In addition to raising the public construction purchase target ratio, Kim suggested expanding the awarding of additional points to women-owned businesses in qualification evaluations to construction projects under 5 billion KRW, strengthening informatization and technical support in the era of the Fourth Industrial Revolution, and promoting the systems implemented by the Ministry of SMEs and Startups or the Women Entrepreneurs Federation through various stakeholders directly related to the construction industry (such as the Ministry of Land, Infrastructure and Transport, and construction-related associations). He emphasized the need to create a "(tentative name) Women-Owned Business Support System Notification Service."

He said, "Women-owned businesses have been found to have advantages in relatively smooth communication, thorough follow-up management, positive image, and transparent company management," adding, "These strengths of women-owned businesses can also contribute to improving the image of the construction industry."

This content was produced with the assistance of AI translation services.