SME Representatives Meet Minister Lee Young: "Need for Supply Price Linkage System and Solutions to Labor Shortage"

Minister Lee Young, Ministry of SMEs and Startups. / Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kim Bo-kyung] On the 18th, the small and medium-sized enterprise (SME) industry requested Minister Lee Young of the Ministry of SMEs and Startups to promptly introduce the delivery price linkage system. They also emphasized the need to improve the foreign workforce quota system to resolve labor shortages and support youth employment.

On the 18th, the Ministry of SMEs and Startups held a 'Dialogue with Small Business Owners' at the Korea Federation of SMEs in Yeouido, Seoul. About 40 people attended the meeting, including Minister Lee, Kim Ki-moon, Chairman of the Korea Federation of SMEs, and chairpersons of industry-specific SME cooperatives.

The meeting was organized to hear field opinions on rising prices, raw material costs, and heavy rains, and to discuss measures to resolve market unfairness, strengthen competitiveness in manpower and sales channels, and recover the livelihood economy.

According to the industry, raw material prices rose by an average of 47.6% compared to 2020 last year, while the delivery price increase rate was only 10.2%, and operating profit margin decreased from 7.0% to 4.7%. Voices from the field urged the prompt introduction of the delivery price linkage system to alleviate the difficulties faced by SMEs.

Considering the increased labor demand due to the full implementation of the 52-hour workweek system and the decline in the working-age population, opinions were also raised to improve the foreign workforce quota system and support youth employment.

There was also a request to support root companies facing harsh conditions. Shin Yong-moon, Chairman of the Korea Mold Industry Cooperative, said, "The sales generated by 30,000 root companies amount to 152 trillion won, and the number of workers reaches 550,000, but recently they have faced a crisis due to decreased orders and soaring prices," adding, "It is necessary to establish dedicated policy funds for the root industry and provide additional points for root companies in Ministry of SMEs and Startups support projects."

The Korea Federation of SMEs submitted nine field proposals and 14 written proposals, including △ support for activating youth employment in excellent local SMEs △ approval of SME-exclusive T-commerce channels △ clarification of standards for allowing cooperative joint actions and expansion of recognition scope.

Minister Lee Young of the Ministry of SMEs and Startups said, "Our economy is facing the re-spread of COVID-19 and a complex crisis of the three highs (high inflation, high interest rates, high exchange rates)," adding, "We will do our utmost to quickly resolve the current adverse factors and promote flagship projects such as the '7-day Companion Festival' and the 'Declaration of Growing Together Korea' in the second half of this year to restore the livelihood economy."

Kim Ki-moon, Chairman of the Korea Federation of SMEs, said, "Minister Lee has experience as a businessperson and in legislative activities, so he understands the field well and can reflect voices in policies," adding, "We will cooperate with the Ministry of SMEs and Startups to solve urgent issues of SMEs such as resolving labor shortages and revitalizing SME cooperatives."