KOSI SME Trends, February 2026 Issue
SME Manufacturing Output Down 3.9% Year-on-Year
SME Services Up 3.6%
Despite an increase in the number of working days in December last year, production in small and medium-sized manufacturing continued to decline. In contrast, production in small and medium-sized service industries showed a modest upward trend, as output increased in sectors such as wholesale and retail, and professional, scientific, and technical services.
On February 26, the Korea Small Business Institute (KOSBI) announced the publication of the February 2026 issue of its report, "KOSI SME Trends." According to the data, production in small and medium-sized manufacturing in December last year fell by 3.9% year-on-year, as output decreased in areas such as metal processing, despite the increase in the number of working days. In contrast, production in small and medium-sized service industries rose by 3.6% year-on-year, with broad-based growth across sectors such as wholesale and retail.
During the same period, retail sales amounted to 57.7 trillion won, an increase of 3.5%. This is interpreted as being driven by broad-based growth in durable goods (8.5%), non-durable goods (2.7%), and semi-durable goods (0.2%) in line with the recovery in domestic demand.
In January this year, the number of employed persons increased by 108,000 compared with the same month a year earlier. While the number of employees at establishments with 300 or more workers increased by 151,000, the number of employees at establishments with fewer than 300 workers decreased by 43,000.
Breaking down establishments with fewer than 300 workers, employment at businesses with 5 to 299 workers increased by 33,000, but employment at businesses with 1 to 4 workers decreased by 76,000. By industry, the decline in manufacturing (-63,000) and construction (-27,000) continued, although the magnitude of the decrease narrowed. Among wage workers, the numbers of regular employees (57,000) and day laborers (21,000) increased, while the number of temporary workers (-108,000) decreased.
In December last year, the number of newly established companies was 102,529, up 13.0% from the same month a year earlier. By industry, there was broad-based growth in sectors such as manufacturing (7.7%), construction (11.8%), and services (14.4%). The number of start-ups in technology-based industries also increased by 35.1% year-on-year to 25,082.
An official at the Korea Small Business Institute said, "While the business conditions for small and medium-sized enterprises appear to be gradually improving, mainly due to better consumer spending, volatility in external conditions such as energy prices and exchange rates remains high. Therefore, policy efforts are needed to strengthen the capacity of small and medium-sized enterprises to respond to external uncertainties."
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