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| gettyimagesbank |
By Yi Whan-woo
Korea faces an increasing number of companies that are closing down, while the number of newly opening businesses is declining, a report showed Thursday.
Released by Statistics Korea, the report titled "Opening and closure rates of enterprises in 2021" showed that 761,000 businesses shut down in 2020, up 3.4 percent from the previous year.
The firms that opened in 2021, meanwhile, totaled 1.02 million, down 3.4 percent from 2020.
The total number of businesses operating in Korea came down to the 7.05 million mark in 2021, as compared to 6.82 million in 2020, 6.52 million in 2019, 6.25 million in 2018 and 6.05 million in 2017.
By industries, 11.3 percent of the firms that shut down were in real estate, 10.6 percent from information technology (IT) and 9.8 percent from science and high-tech sectors.
Of the new companies, 17.3 percent were in IT, 13.2 percent in science and high-tech sectors and 9.7 percent in logistics and inventory.
By size, microbusinesses and the self-employed accounted for 98.6 percent of the firms that shut down and 97.8 percent of the new companies.
In terms of employment numbers, the companies that closed down altogether originally hired a combined total of 970,000 people as compared to a combined 1.43 million people hired by the new businesses.
In relation to the age of CEOs, a total of 49,097 of the companies that shut down had leaders aged younger than 30 years old. Another 126,813 firms were led by CEOs in their 30s, followed by 184,788 led by those in their 40s, 201,399 by those in their 50s and 198,559 by those in their 60s or older.
Among the new companies, 98,966 were led by CEOs younger than 30, 210,816 by those in their 30s, 271,588 by those in their 40s, 253,710 by those in their 50s and 186,472 in their 60s or older.
Concerning the gender breakdown of CEOs, the number of companies led by women when they shut down increased 4.3 percent year-on-year to 360,000, while the number of new, female-led firms decreased 3.9 percent year-on-year to 477,000.
Meanwhile, the number of rapidly growing companies with more than 10 employees and posting a sales increase of 20 percent or higher increased from 4,215 to 4,995 between 2020 and 2021.
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