"'Small but Strong' SoBuJang Companies Also Face Labor Shortage... Ministry of SMEs Calls for Expanded KOTRA Role"

Kang Hoon-sik, Chair of the SME Subcommittee of the National Assembly Industry, Trade, and SMEs Committee, Visits Site and Listens to Current Issues

[Asia Economy Reporter Moon Hyewon] As the government implements various policies to foster domestic materials, parts, and equipment (SoBuJang) companies, some local businesses are reportedly suffering from a "labor shortage." There are calls for establishing long-term working conditions for young workers at local small and medium-sized enterprises (SMEs).

On the 3rd, according to Democratic Party lawmaker Kang Hoon-sik, Kim Doo-cheol, CEO of the SME AMT located in Asan City, Chungcheongnam-do, said, "A major problem for local SMEs is a mismatch in manpower," adding, "Although everyone says there are no jobs, people do not come to the provinces, and when engineers are trained locally, they move to the Seoul metropolitan area."

AMT is an SME specializing in semiconductor equipment and automation equipment manufacturing. Last year, it was selected as one of the 'Top 100 SoBuJang Strong SMEs' by the Ministry of SMEs and Startups. The company currently employs about 80 people and recorded sales of 20 billion KRW last year.

Kang, chair of the SME Subcommittee of the National Assembly's Industry, Trade, Energy, SMEs, and Startups Committee, visited AMT headquarters that day to hear about on-site difficulties and explore necessary support measures for SMEs.

Lee Si-hee, head of the Chungnam Regional Small and Medium Venture Business Administration, who accompanied the visit, explained, "There is a statistic showing that only 17% of trainees at local companies remain with the company," adding, "Manpower from Chungcheong moves to the Seoul metropolitan area, and the workforce needed in Chungcheong comes from the Honam region."

The effectiveness of government support measures for SoBuJang strong SMEs was also discussed at the meeting. CEO Kim pointed out, "Investment support, research and development (R&D) support, and credit support are urgent."

The Ministry of SMEs and Startups provides preferential support to SoBuJang strong SMEs through its SME support projects (30 projects, up to 18.2 billion KRW). For R&D, a dedicated budget of 12.5 billion KRW (for next year) has been allocated, and for guarantees, the preferential limit has been raised to 3 billion KRW (general companies 1.5 billion KRW). Regarding this, CEO Kim said, "I didn't know such benefits existed."

Lawmaker Kang said, "It is regrettable that local SMEs perceive consulting and support from government or public institutions such as the Ministry of SMEs and Startups or KOTRA as too difficult, almost like a 'high wall,'" adding, "When SMEs face complex difficulties, the public sector should actively resolve their issues through proactive administration and promote business activities."