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Photo = IRS |
[Alpha Biz= Reporter Kim Minyoung] On the 15th of this month, according to tax statistics from the National Tax Service, the number of individuals and corporations that closed their businesses and filed for closure last year totaled 986,487. This marked an increase of 119,195 compared to the previous year's 867,292, making it the highest number recorded since related statistics began in 2006.
The number of closures remained in the 800,000 range from 2020 to 2022 but surged close to 1 million last year. Among the reasons cited for closures, "poor business performance" was the most common, with 482,183 closures, an increase of 75,958 (18.7%) compared to the previous year, marking the largest increase on record.
Other reasons for closures included "other" (451,203), transfers and acquisitions (43,690), and corporate transformations (4,685).
By industry, retail had the highest number of closures at 276,535, followed by services (217,821), and food services (158,279). There were also significant closures in real estate leasing (94,330) and construction (48,608), reflecting the economic downturn in these sectors last year.
The closure rate for last year was 9.0%, showing an upward trend for the first time in 8 years since 2016 (11.7%). The closure rate represents the proportion of closures to the total sum of active businesses and closures.
Looking ahead, with continued domestic economic challenges, particularly in sectors like food and accommodation, and wholesale and retail, closures are expected to persist this year. The number of self-employed individuals returned to negative growth (-9,000) in the first quarter after about two years, followed by a reduction of 101,000 in the second quarter. Specifically, the number of micro self-employed individuals without employees decreased by 114,100 compared to the same period last year, marking the largest decline since the fourth quarter of 2015 (-118,200), spanning over 8 and a half years.
AlphaBIZ Kim Minyoung(kimmy@alphabiz.co.kr)
