Ministry of SMEs and Startups Launches "Employment Insurance Premium Support Program" for Small Business Owners Facing Closure Risk

Insurance Premium Subsidies of 50% to 80% for Up to Five Years

The Ministry of SMEs and Startups announced on May 15 that it will implement the "Employment Insurance Premium Support Program for the Self-Employed" to help small business owners prepare for the risk of business closure.

With the rapid increase in the closure rate of small business owners, vacant stores are lined up in a commercial district in Sinchon, Seoul. Photo by Jo Yongjun

Employment insurance for the self-employed is a system that provides unemployment benefits and vocational training in the event of business closure. The ministry currently subsidizes 50% to 80% of the insurance premiums for small business owners who enroll, for up to five years.

Amidst recent economic slowdown and sluggish domestic demand, the business environment for the self-employed has deteriorated, highlighting the growing importance of social safety nets that support livelihood stability and recovery after closure. In 2024, the number of business closure reports reached 1,008,282, surpassing one million for the first time. Last year, the number of self-employed individuals who received unemployment benefits was 3,820, and the total amount paid reached 20.526 billion won, both marking record highs.

In response to these circumstances, the ministry has been operating the employment insurance premium support program for small business owners since 2018. As a result, the total number of self-employed individuals enrolled in employment insurance increased about 3.5 times, from 17,500 in 2017 to 61,632 in 2025, while the number of new enrollees grew about 5.1 times, from 4,215 to 21,528. The policy support to reduce premium burdens is seen as a key factor contributing to this expansion in enrollment.

Meanwhile, starting this year, Chungcheongnam-do Province has also joined the employment insurance premium support program for small business owners, making it possible to receive both central government and additional local government support anywhere in the country. Chungcheongnam-do plans to subsidize 20% to 50% of premiums by standard wage class for up to five years for one-person businesses. As a result, in Gangwon-do and Chungcheongnam-do, small business owners can receive up to 100% of their employment insurance premiums covered when combining government support (50% to 80% by class) with additional local government subsidies.

The Ministry of SMEs and Startups and the Small Enterprise and Market Service plan to proactively identify small business owners who have only applied for either central or local government support, working together with local governments to address gaps in coverage. The ministry has set a goal of supporting 42,200 people this year and aims to further strengthen on-site guidance and promotional efforts.

Choi Wonyoung, policy chief for small business, said, "With business closures on the rise in this difficult business environment, employment insurance for the self-employed is an important social safety net that supports the livelihood stability and recovery of small business owners. By enrolling in employment insurance, self-employed individuals can receive unemployment benefits and vocational training support upon closure, and by utilizing the premium support program, can significantly reduce their premium burden. We hope that more small business owners will enroll in employment insurance and take advantage of these social safety net benefits."

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