Startups go out of business more often in Korea

The number of new firms in the nation’s eight largest cities, including Seoul and Busan, shrank by about 13%, from 2,864 in October to 2,493 in November, the central bank said, adding that the number in November was about the same as the average monthly startup firms of 2,558 in 1999, right after the 1997 financial crisis. The number of startup firms plunged during the financial crisis before leveling off at around 3,000 a month in 2000, 2002 and 2002. This year, the average fell to 2,555 for the period from January through November, the bank said.

The central bank said that the nation’s employment market has been worsening over the last several decades, while permanent jobs become obsolete and a large number of salaries workers dream of starting their own firms. Their interest in launching new firms, however, has been much foiled by frigid domestic consumption and the business sector’s stinginess in facility investments. The Korean businesses’ facilities investment has been dropping sharply, from negative 3.4% in the first quarter to negative 3.7% in the next, and reeling to negative 7% in the third quarter, the bank said.

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