80% of Small and Medium Enterprises Expect Economic Conditions to Worsen or Remain Similar Over the Next 5 Years

An industrial site of a small and medium-sized enterprise in the Seoul metropolitan area.

[Asia Economy Reporter Donghyun Choi] It has been found that 80% of domestic small and medium-sized enterprises (SMEs) expect the economic outlook over the next five years to either worsen or remain similar to the current situation.

On the 16th, a survey commissioned by the public interest foundation Gyeongcheong to Gallup Korea was conducted on 1,000 SMEs with annual sales of over 100 million KRW. Among them, 43.4% of SMEs anticipated that the economy would worsen compared to now. Those who believed it would remain similar accounted for 38.4%. Only 18.3% expected improvement.

By industry, wholesale and retail trade (51.7%) and educational services (46.2%) showed relatively high expectations of worsening. On the other hand, manufacturing (19.8%) and accommodation and food services (19.7%) had a relatively higher outlook for improvement.

The factor most cited as darkening the economic outlook for SMEs was the "continuous rise in raw material prices." This was followed by "reoccurrence of infectious diseases such as COVID-19" and "slowing national economic growth," in that order.

Regarding the evaluation of policies for SMEs and small business owners under the previous Moon Jae-in administration, the satisfaction rate was somewhat higher at 53.4% compared to the dissatisfaction rate of 46.5%. In the assessment of the Ministry of SMEs and Startups, the main government agency, positive evaluations of good performance were 58.5%, somewhat higher than the negative evaluations of poor performance at 41.5%.

When asked about expectations for the SME policies of the newly launched Yoon Suk-yeol administration, 63% responded that they "expect" positively, higher than the 37% who "do not expect." Regarding hopes for the Yoon Suk-yeol administration in protecting, fostering, and supporting SMEs and small business owners, many responses related to financial support such as "low-interest loans," "tax support," "funding support," and "tax reductions" were noted. Opinions requesting "regulatory relaxation" and workforce support were also relatively high.

This survey was conducted by the public interest foundation Gyeongcheong, which provides free legal and administrative support to protect SME rights. It aimed to identify perceptions of fairness felt by SMEs, operational difficulties, and urgent issues to urge institutional improvements to the government and National Assembly. The survey was conducted through direct visits considering industry and regional distribution. The survey period lasted about 40 days from June 2 to July 8, with a sampling error of ±3.1 percentage points at a 95% confidence level.

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