Lengthened Economic Recession Causes 'Screams' Among Self-Employed
As the economic recession prolongs, self-employed individuals are once again shaken.
In particular, those who operated with employees are being forced to downsize or go out of business, returning to the status of 'solo entrepreneurs.'
According to the Statistics Korea's employment trends and the National Statistical Portal (KOSIS) on the 13th, the number of self-employed individuals in the first quarter of 2025 is estimated to be 5.523 million. This figure represents a decrease of 14,000 compared to the same period the previous year.
The number of self-employed decreased by 9,000 in the first quarter of 2023, 101,000 in the second quarter, and 26,000 in the third quarter, followed by a temporary increase of 10,000 in the fourth quarter. However, it has started to decline again this year. In particular, the number of 'self-employed individuals with employees' decreased by 25,000.
In contrast, the number of 'self-employed individuals without employees' increased by 11,000. Due to the impact of the economic downturn, self-employed individuals who have laid off employees are increasing, as they manage their businesses alone. There is a possibility that some have ended up going out of business or transitioned to being wage workers.
A Statistics Korea official explained, "The number of self-employed individuals with employees has decreased, particularly in wholesale and retail as well as transportation and warehousing sectors."
The concern is that this trend may not be a one-time occurrence. Since employment is a lagging indicator of the economy, there are worries that the current domestic demand slump could lead to worsening employment indicators in the future.
If consumption decreases, employment will also decrease, and the reduction in employment could lead to a further shrinkage in household income, creating a vicious cycle that dampens consumption again.
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