48% of Small and Medium Enterprises Pay Chuseok Bonuses... 447,000 Won Per Person

Announcement of Survey Results from 800 Small and Medium Enterprises
Average Shortfall in Chuseok Funds: 12.8 Million KRW

This year, 48.3% of small and medium-sized enterprises (SMEs) plan to pay Chuseok bonuses. This figure is 11 percentage points higher than last year.

On the 10th, the Korea Federation of SMEs announced the results of the "2023 SME Chuseok Fund Demand Survey." The survey was conducted from the 21st of last month to the 1st of this month via email, fax, and telephone, targeting 800 SMEs.

On the 30th of last month, Chuseok reservation products were displayed at Yangjae Rohana Mart in Seoul. Photo by Jo Yongjun jun21@

The level of Chuseok bonus payments increased compared to the previous year. For proportional payments, the rate rose from 50.0% last year to 53.7% this year. For fixed payments, the amount per person increased by 11.2% to 447,000 KRW from 402,000 KRW last year.

However, the response indicating that financial conditions for this year’s Chuseok are "difficult" was 26.9%, higher than those who said it was "smooth" at 15.8%. Those who responded "same as last year" accounted for 57.4%.

The main reasons for financial difficulties (multiple responses allowed) were poor sales and revenue (77.7%), followed by rising labor costs (36.7%), increased prices of raw and subsidiary materials (33.0%), and delayed payment collection (11.6%).

Regarding funding conditions through financial institutions such as banks and policy finance institutions, 16.1% responded that conditions are "smooth" compared to last year’s Chuseok. Those who said "difficult" were 14.0%, and "same as last year" was 69.9%.

The main difficulties in securing funds through banks (multiple responses allowed) were high loan interest rates (41.6%), excessive document submission requirements (6.5%), and insufficient loan limits (5.8%). Meanwhile, 52.5% reported no particular difficulties.

The average amount needed for this year’s Chuseok funds was 115.6 million KRW. The average shortfall compared to the required funds was 12.8 million KRW. Considering that last year’s survey showed a required amount of 157 million KRW and a shortfall of 22 million KRW, both figures have decreased. Joo Moon-gap, head of the Economic Policy Division at the Korea Federation of SMEs, explained, “The decrease in Chuseok fund demand reflects the fact that a considerable number of SMEs are responding to export declines and sluggish domestic demand through tight management.”

As for ways to secure the insufficient Chuseok funds (multiple responses allowed), respondents cited early collection of payment for deliveries (44.4%), borrowing from financial institutions (20.4%), and payment deferrals (19.4%). Additionally, 25.9% said they had no suitable measures.

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