Number of self-employed with hired workers falls steepest in 22 years in 2020

[Graphics by Song Ji-yoon]

Self-employed with hired staff shriveled by the biggest pace last year since the Asian financial crisis 22 years ago in South Korea as social distancing measures throughout last year landed hard on mom-and-pop stores.

According to Statistics Korea on Monday, the number of the self-employed in Korea stood at 5,531,000 last year, down 75,000 from the previous year. The number is the smallest since 1994 when the country had 5,376,000 self-employed workers.

The on-year loss is largest in three years, as the number dropped 44,000 in 2018 compared to the previous year and 32,000 in 2019.

The small merchants have also significantly cut their workforce during the pandemic. The number of the self-employed with hired workers declined by 165,000 from a year ago to 1,372,000 in 2020, recording the sharpest fall in 22 years since 1998 when the number dropped 247,000 on year due to the shock from the Asian Financial Crisis. The number of one-man operations, on the other hand, grew at the fastest speed in 19 years by 90,000.

Experts believe many of the small business owners may have fired their employees other than themselves to cut the labor cost when their sales are plunging amid Covid-19. New entrepreneurs also tend to opt for one-person operation or installing kiosks instead of hiring workers to reduce fixed cost.

[¨Ï Maeil Business Newspaper & mk.co.kr, All rights reserved]