"Service Industry Must Get Fair Prices... SMEs Appeal for Laws and Systems"

Basic Service Industry Development Act Fails to Pass Parliament for 11 Years
"MICE Industry in Exhibitions Faces Growth Challenges Due to Hierarchical Relationships"
Criticism of Subcontracting and Dominance by Large Conglomerate Affiliates

The event venue at BEXCO in Haeundae-gu, Busan. The MICE industry, including exhibitions and conventions, is a representative knowledge service sector but is struggling due to structural issues in the subcontracting system involving various stakeholders.
[Image source=Yonhap News]

"There are still many cases where fair compensation for services is not paid. We need to establish laws and systems to systematically foster the service industry." (Kim Bun-hee, Chairwoman of the Korea Women Venture Association)

"The service industry must develop to increase jobs, but regulations to revitalize it have not been lifted. It is true that it has been neglected compared to manufacturing." (Nam Min-woo, Chairman of the Youth Entrepreneurship Foundation and Chairman of Dasan Networks)

As our exports have stalled due to rising raw material and energy prices, voices are growing louder to foster the service industry as an alternative to overcome the economic crisis. The idea is to increase added value and create jobs through investment and support in the service sector. Especially in the small and medium-sized enterprise (SME) sector, there is a unified call for the enactment of the Service Industry Development Basic Act (Seobalbeop). The Seobalbeop has been stalled in the National Assembly for 11 years without seeing the light of day.

Unlike manufacturing, the service industry is often invisible and intangible, so it has not been properly recognized for its value until now.

Kim Bun-hee, President of the Korea Women Venture Association / Photo by Moon Ho-nam munonam@

Kim Bun-hee, Chairwoman of the Women Venture Association, has worked in the MICE (Meetings, Incentives, Conventions, and Exhibitions) industry for over 30 years. She said, "When signing service contracts, what the event organizers call the 'price' is what matters. It is true that SMEs find it difficult to invest and nurture talent," adding, "There is generally a lack of awareness about the market value of knowledge services."

She has urged the enactment of the Seobalbeop in every media interview for over 10 years. Chairwoman Kim said, "I hope that through the enactment of the Seobalbeop, the concept of service will be established and an environment where fair compensation for services is paid will be created."

Na Dong-myung, Chairman of the Korea Exhibition and Event Industry Cooperative, also pointed out structural problems in the service industry. He lamented, "Subsidiaries of large corporations effectively dominate the private exhibition event market," and added, "SMEs are in a structure where they receive subcontracting work repeatedly."

Public institutions under the Ministry of SMEs and Startups, such as the Small and Medium Business Distribution Center, reportedly entrust events like the 'Korea Sale Festa' not to SMEs but to subsidiaries of large corporations like Cheil Worldwide and Daehong Communications. Large corporation subsidiaries take a portion of the total contract amount as if it were a 'toll fee,' which inevitably shrinks the profits that subcontracted small business operators receive.

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