As many as 4.37 million people in South Korea run their business without employees, the highest number in 15 years since 2008, when the global financial crisis hit.

According to data released by Statistics Korea on Wednesday, there were 6.72 million non-wage workers as of August 2023. This includes 1.41 million self-employed individuals with employees, 4.37 million self-employed individuals without employees, and 940,000 unpaid family workers. Non-wage workers are those who work in businesses run by self-employed individuals or family members without pay.

The number of self-employed individuals without employees increased for the fifth consecutive year since 2018, hitting 4.37 million or up 34,000 from 4.33 million in 2022.

“The number of ‘one-person business owners’ increased significantly in the construction industry, which includes plasterers, paperhangers, interior designers, and excavation machine operators,” an official from Statistics Korea said.

Shin Se-don, an economics professor at Sookmyung Women’s University, explained, “This is interpreted as a phenomenon caused by unemployed people in their 50s choosing to open their own business rather than seeking re-employment.”

The number of one-person business owners in their 50s has increased by 52,000 in just a year.

“It seems to be a polarizing phenomenon, with self-employed people who accumulated more debt during the Covid-19 pandemic cutting back on their workforce due to the burden of high interest rates, while new self-employed people with employees are emerging,” a senior official from the Korea Economic Research Institute said.

The economically inactive population, which refers to the number of people aged 15 and older who are neither employed nor unemployed, stood at 16.16 million in August, down 83,000 from a year earlier. The number of economically inactive people fell by 58,000 in their 20s and 114,000 in their 30s, while the number rose in people in their 60s and older.

The number of young adults who were “off work” - those who did not have a serious illness or disability but were not economically active - increased by 66,000 compared to a year earlier. The number of people who were off work in August 2023 was 384,000 in their 20s, up 28,000 from a year ago, and 292,000 in their 30s, up 38,000. The primary reasons for those under 20 to take time off included “difficulty in finding a desired job” at 32.5 percent, followed by “taking time off to prepare for the next job” at 23.9 percent.

By Lee Yoon-sik and Yoon Yeon-hae

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]