March SME Real Economy and Export Improvement... Startup and Business Sentiment Decline

[Financial News] In March, the production and export of SMEs increased slightly compared to the same period last year, but business uncertainty expanded due to a decrease in working days and worsening trade environment.
According to the 'SME Trends May 2025' report released by the Small and Medium Business Research Institute on the 27th, SME manufacturing production in March increased by 0.3% compared to the same month last year. Despite adverse conditions such as nationwide wildfires and a decrease in working days (-0.5 days), the production of key items such as semiconductors led the increase. During the same period, SME service production also increased by 0.2%.
Domestic indicators also improved. In March, retail sales amounted to 55.6 trillion won, an increase of 2.8% compared to the same month last year. In particular, both durable goods (3.9%) and non-durable goods (2.9%) turned to an upward trend. Online shopping transactions also increased by 2.6% to 22.4 trillion won. However, the increase was limited due to sluggish e-coupon services.
Exports increased by 0.7% to 27 billion dollars in the first quarter, driven by strong exports of cosmetics (19.6%), automobiles (67.4%), and semiconductor manufacturing equipment (11.2%). Exports to the United States decreased by 2.5% due to a slowdown in demand for secondary battery equipment, but it still maintained its position as the top export destination.
The employment market showed improvement. In April, the number of SME employees increased by 34,000 compared to the same month last year, totaling 25.56 million. Employment in businesses with 5-299 employees increased by 107,000, while those with 1-4 employees decreased by 73,000. Employment increased significantly in health and social welfare services (218,000), professional, scientific, and technical services (69,000), and education services (57,000).
Startups and business sentiment both declined. The number of startups in March was 100,640, a decrease of 4.7% compared to the same month last year. All sectors, including manufacturing (-5.2%) and construction (-5.0%), showed a downward trend. The small business sentiment index (BSI) in April was 63.6, down 2.9 points from the previous month, and the traditional market BSI in May was 75.2, down 9.3 points over the same period.
The Small and Medium Business Research Institute stated, "The main economic indicators such as SME production and employment have only slightly increased, indicating that economic recovery is still slow and startups have decreased," and emphasized the need to "promote SME and small business vitality through consumption promotion policies and productivity improvement policies."

jimnn@fnnews.com Shin Ji-min Reporter