October SME Business Outlook 'Cloudy'... Business Outlook Index at 75.4

Down 4.9 Points from Previous Month
Outlook Worsens for Domestic Sales and Exports

The outlook for small and medium-sized businesses in October indicates further contraction. As key indicators such as domestic sales, exports, and financial conditions are not expected to improve compared to September, both the manufacturing and non-manufacturing business outlook indices have shown a downward trend.

According to the "October 2025 Small and Medium Business Economic Outlook Survey" released by the Korea Federation of Small and Medium Business on September 29, the Small Business Health Index (SBHI) for October stood at 75.4, down 4.9 points from the previous month. Compared to the same month last year (78.4), it dropped by 3.0 points.

Korea Federation of Small and Medium Business's "October 2025 Small and Medium Business Economic Outlook Survey." Korea Federation of Small and Medium Business

By industry, the business outlook deteriorated for both manufacturing and non-manufacturing sectors. The October outlook for manufacturing fell by 6.5 points from the previous month to 76.6, while the non-manufacturing sector recorded 74.9, down 4.2 points over the same period.

Across all industries, domestic sales, operating profit, exports, and financial conditions are all expected to worsen compared to the previous month. Employment, which typically moves in the opposite direction (95.8→97.2), is also expected to deteriorate from the previous month.

When comparing the average SBHI for each category in the same month over the past three years, only raw materials in the manufacturing sector are projected to improve, while all other categories are expected to worsen compared to the three-year average. In the non-manufacturing sector, all categories except exports are forecast to deteriorate compared to the previous three-year average.

In September, the most significant management challenge for small and medium-sized businesses was "sluggish sales" (60.6%), followed by ▲ rising labor costs (35.7%), ▲ increases in raw material prices (29.8%), and ▲ intensified competition among companies (29.6%).

The average operating rate of small and medium-sized manufacturers in August was 70.4%, a decrease of 1.0 percentage point from the previous month and a drop of 1.1 percentage points compared to the same month last year. By company size, small enterprises (68.0%→66.9%) saw a decrease of 1.1 percentage points from the previous month, while medium-sized enterprises (75.2%→74.3%) fell by 0.9 percentage points.

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