Government's Social Enterprise Promotion 'Empty Words'... Only 5% Growth in Supported Companies

Jang Cheol-min "Support for Non-Capital Regions... Adjust Goals if Necessary"

Jang Cheol-min, member of the Democratic Party of Korea (second from the left), speaking at a press conference urging the expansion of youth recruitment in public institutions held in front of the National Assembly Main Building in Yeouido, Seoul, on April 27. (Photo by Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] It has been revealed that among the social enterprise candidates nurtured with over 100 billion won invested by the government, only about 5% have actually grown into real enterprises.

According to the 'Social Entrepreneur Nurturing Project Performance' data received on the 29th from the Ministry of Employment and Labor by Jang Cheolmin, a member of the National Assembly's Environment and Labor Committee from the Democratic Party of Korea, out of 3,253 teams supported from 2018 to August this year, only 150 teams (5.2%) successfully became social enterprises. The nurturing project primarily provides startup funds and education according to the stages of startup, preliminary social enterprise, and social enterprise. The majority of teams failed to grow into enterprises despite receiving support.

Looking at the number of social enterprises entering each year, it decreased about ninefold from 102 teams (entry rate 15.3%) in 2018 to 35 teams (4.4%) in 2019, and 12 teams (1.4%) last year. This year, only one team entered as of last month. By region, Seoul supported the most teams at 939, but the entry rate was only 2.3%. Excluding Sejong, which had a 0% entry rate with no teams entering, Seoul ranked last.

Assemblyman Jang said, "Even considering that it takes time to obtain social enterprise certification after the end of startup support, the continuous decline in social enterprise entry rates indicates the need to enhance the effectiveness of the project." He added, "We need to carefully analyze the causes of the low entry rate, adjust nurturing goals, or devise institutional improvement measures such as focusing support on non-metropolitan areas where the entry rate is relatively higher."

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