Small Business Owners: "We're Dying Like This, Change the Quarantine System"

Survey by Korea Federation of SMEs: 63% of Small Business Owners Contemplate Temporary Closure Due to Social Distancing Measures
Press Conference Urging Reform of Quarantine System by SME and Small Business Organizations

On the 2nd, as the fourth wave of COVID-19 continues with confirmed cases remaining in the 1,000s, Kim Ki-moon, chairman of the Korea Federation of SMEs, along with representatives of small business organizations and self-employed individuals, held a press conference at the Korea Federation of SMEs in Yeouido, Seoul, demanding a revision of the quarantine system. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporters Heeyoon Kim and Junhyung Lee] Jung Youngjun (pseudonym), who has operated a health club in Pocheon, Gyeonggi Province for 21 years, incurred a debt of 150 million KRW last year due to the impact of COVID-19. Recently, Jung suffered a deficit close to 5 million KRW over two months from July to August this year due to the Level 4 social distancing measures. Jung said, "The government's current quarantine system is a typical case of armchair theorizing," adding, "I don't understand the meaning of regulations such as limiting the treadmill speed to 6 km/h."

Cafe A in Sillim-dong, Gwanak-gu, Seoul, has seen daily sales drop by 20-30% since last week. This is due to the extension of the Level 4 social distancing in the metropolitan area, which shortened business hours by an additional hour from 10 p.m. Cafe A, with a store area of 248㎡ (75 pyeong), has fixed monthly costs including rent and management fees amounting to 11 million KRW. Park Younghoon (pseudonym), the cafe owner, lamented, "Since November last year, sales minus fixed costs have continuously been negative," and added, "Reducing evening business hours by one hour not only decreases customers during that time but also damages the entire evening business." Park also noted, "Unlike bars, cafes have customers who are cooperative when asked to wear masks," and questioned, "Isn't it appropriate to move non-alcoholic beverage businesses, currently classified as Group 2, to Group 3 along with academies and study cafes, separate from alcoholic beverage businesses?"

As the prolonged COVID-19 pandemic has extended Level 4 social distancing for two months, voices demanding a shift to a sustainable quarantine system are growing among medium-sized enterprises and small business owners. Small business owners are appealing for a new quarantine system that strictly enforces prevention rules while maximizing economic activities, as high-intensity gathering bans and business restrictions continue.

Amid the prolonged COVID-19 crisis, the debt of self-employed individuals increased by nearly 10 trillion won in the second quarter (April to June) of this year alone. According to the "2021 Q2 Depository Institutions' Industry-Specific Loan Data" released by the Bank of Korea on the 1st, the outstanding loans from deposit banks to non-corporate enterprises (self-employed) reached 418.5 trillion won at the end of the second quarter, an increase of 9.4 trillion won compared to the previous quarter. The photo shows the lifeless scene of Myeongdong on that day. Photo by Moon Honam munonam@

240,000 Self-Employed with Employees Decrease, Record High Number of Solo Self-Employed Working Second Jobs for Livelihood

According to a survey of 500 self-employed individuals conducted by the Korea Federation of SMEs on the 2nd titled ‘Small Business Owners’ Perceptions in the Era of Coexisting with COVID-19,’ 63% of respondents said they are considering business closure or suspension if the current social distancing-centered quarantine system continues. Additionally, 91.4% of small business owners reported that their sales in July and August declined compared to the same period last year. The number of self-employed with employees decreased by 246,000 compared to two years ago. According to Statistics Korea’s employment trends, the number of self-employed with employees hit its lowest point in 31 years since July 1990, while the number of solo self-employed working second jobs reached a record high of 155,000 in July this year since related statistics began. Among 429,000 micro self-employed without employees, 36.1% are engaged in secondary jobs outside their main business.

As the situation worsened, on the 2nd, five SME and small business organizations including the Korea Federation of SMEs held a press conference urging a transition to a ‘with COVID-19’ response and a reorganization of the quarantine system. They appealed for a shift to ‘with COVID-19’ that strictly enforces daily quarantine measures while maximizing economic activities. Kim Ki-moon, chairman of the Korea Federation of SMEs, emphasized, “With COVID-19 continuing for nearly two years and the timing of herd immunity formation unpredictable, the current uniform quarantine policy only increases damage to small business owners. We must transition to ‘with COVID-19’ that strictly enforces daily quarantine but maximizes economic activities.”

The majority of small business owners expressed hope for a reorganization of the quarantine system due to the prolonged COVID-19 pandemic. According to the Korea Federation of SMEs survey, 76.8% of small business owners supported the reorganization of the quarantine system. Regarding the reorganization plan, 42.8% hoped for phased easing of quarantine measures based on vaccination rates, while 34.3% desired a full easing regardless of industry type.

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