December SME Business Outlook Index 72.6... Declining for 2 Consecutive Months

Korea Federation of SMEs Announces Survey Results of 3,069 SMEs
High Proportion of 'Domestic Demand Slump' as November Management Difficulty

The Small and Medium Business Index (SBHI) for December fell by 4.5 points compared to the previous month. This marks a decline for two consecutive months.

Provided by Korea Federation of SMEs

The Korea Federation of SMEs announced the results of the "December 2024 Small and Medium Business Outlook Survey," conducted from the 14th to the 21st of last month, targeting 3,069 small and medium enterprises, on the 28th.

The business outlook index for December was 72.6, down 4.5 points from the previous month. This decline continued for the second consecutive month, with the drop compared to the previous month also increasing. Compared to the same month last year (78.8), it decreased by 6.2 points.

The December business outlook for manufacturing fell 3.0 points from the previous month to 79.3, while non-manufacturing dropped 5.1 points to 69.7. Construction (69.6) decreased by 2.2 points, and services (69.7) fell by 5.7 points compared to the previous month.

Within manufacturing, seven sectors centered on "Chemical Substances and Chemical Products" rose compared to the previous month, whereas 16 sectors, including "Beverages" and "Metal Processing Products," declined.

In the service sector, three industries such as "Publishing, Video, Broadcasting, Telecommunications, and Information Services" and "Transportation" increased, while seven industries including "Real Estate" and "Business Facility Management, Business Support, and Rental Services" decreased.

Domestic sales, operating profits, exports, and financial conditions declined compared to the previous month, but employment levels, which show a counter-trend, are expected to improve slightly from the previous month.

The biggest management difficulty for small and medium enterprises in November was sluggish domestic demand (64.6%). This was followed by "Rising Labor Costs" (45.4%), "Excessive Competition Among Companies" (37.3%), and "Rising Raw Material Prices" (30.1%). Regarding trends in management difficulties, "High Interest Rates," "Sluggish Domestic Demand," "Rising Raw Material Prices," and "Excessive Competition Among Companies" increased compared to the previous month, while responses for "Rising Labor Costs" and "Delayed Collection of Sales Proceeds" decreased compared to the previous month.

The average operating rate of small and medium manufacturing enterprises last month was 71.9%, up 0.4 percentage points from the previous month, but down 0.9 percentage points compared to the same month last year.

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