Small and Medium Enterprises Show Economic Recovery... "Need for Countermeasures Against Export-Import Risks Due to Russia Situation"

KOSBI Research Institute Announces 'KOSI SME Trends' February Issue
Manufacturing Production Increases for Two Consecutive Months...Retail Sales Up 5 Trillion KRW Year-on-Year
Self-Employed with Employees Show Employment Growth in Last Two Months

Asia Economy DB=Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kim Bo-kyung] The small and medium-sized enterprise (SME) economy is shifting to a recovery trend centered on production and employment. However, domestic and international risks such as the spread of the Omicron variant and the Russia-Ukraine situation are expected to act as uncertainty factors.

According to the February issue of 'KOSI SME Trends' released on the 27th by the Small and Medium Business Research Institute, SME manufacturing production in December last year increased by 1.0% compared to the same month of the previous year, marking two consecutive months of growth. SME service production also rose by 6.0% during the same period, maintaining an upward trend with a 1.1 percentage point increase compared to the previous month.

The average operating rate of SME manufacturing was 72.6%, up 2.7 percentage points from the same month last year.

The institute stated, "SME industrial production continues to show a favorable trend," adding, "SME exports in January reached $9.89 billion, setting a record high for SME exports in January."

Retail sales in December last year amounted to 46.9 trillion won, an increase of 5 trillion won (11.9%) compared to the same month the previous year. Due to the base effect from the impact of COVID-19 and the recovery of consumer sentiment, sales grew significantly, especially in department stores (3.3 trillion won, 34.5%).

During the same period, online shopping transaction volume recorded 18.4 trillion won, up 2.5 trillion won (15.8%) compared to the same month last year. Notably, mobile shopping accounted for 73.9% of total online shopping, maintaining a steady growth trend.

The employment market also showed signs of stabilization. In January, the number of employees in SMEs was 24.07 million, an increase of 990,000 compared to the same month last year. By company size, firms with 1-4 employees increased by 315,000, and those with 5-299 employees increased by 675,000.

Employment in SME manufacturing increased for three consecutive months, and employment in educational services, professional, scientific, and technical services rose for 11 consecutive months. Employment in accommodation and food services also increased by 123,000, showing a two-month consecutive growth trend, but employment in wholesale and retail trade decreased by 53,000, continuing a downward trend.

Self-employed individuals with employees had experienced a decline in employment for 38 months but have recently shown an increasing trend over the past two months.

The institute stated, "Our economy is gradually shifting to a recovery trend centered on employment and production," but also noted, "Domestic demand contraction due to the spread of the Omicron variant and heightened Russia-Ukraine tensions, as well as rising international oil prices, are expanding domestic and international uncertainties."

It added, "These are expected to act as constraints on the future recovery of the SME economy," and suggested, "Flexible operation of domestic demand recovery support policies and proactive government measures to mitigate risks for SME exporters and importers are required."

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