Despite a recovery in birth rates, half of small and medium enterprise (SME) workers and small business owners are hesitant to have children due to housing costs, childcare expenses, and gaps in care services. The SME sector is calling for not only financial support but also systemic improvements tailored to their needs to address the low birthrate issue.
On June 22, the Korea Federation of Small and Medium Businesses (KBIZ) held a policy meeting in Yeouido, Seoul, in collaboration with the Low Birthrate and Aging Society Committee, where they presented the results of a perception survey.
The survey, conducted from June 2 to 8 among 600 SME workers and representatives of small businesses, revealed that 57% of SME workers are either contemplating marriage or have no intention of marrying. The desire to have children has also significantly declined, with 51.0% of SME workers and 50.7% of small business representatives indicating they do not intend to have children.
This contrasts with the recent trend of declining birth rates, which fell to 230,000 in 2023 but rebounded to 238,300 in 2024, and surpassed 250,000 last year.
Among the reasons cited by SME workers for not having children (multiple responses allowed) were the financial burden of housing, childcare, and education costs (64.3%), the difficulty of balancing work and parenting (54.3%), and the lack of childcare services and infrastructure (42.7%). Small business representatives also identified financial burdens and gaps in care services as significant factors deterring childbirth.
However, respondents indicated that addressing these issues could change their perspectives. They prioritized expanding economic support (77.1 out of 100 points) and increasing reliable childcare services (77.2 points) as conditions that could positively influence their thoughts on marriage and childbirth.
Park Eun-jung, a researcher at the Childcare Policy Institute, suggested that to increase the birthrate, it is essential to alleviate economic burdens and establish a trustworthy childcare system. She also emphasized the need for enhanced incentives for SMEs to adopt flexible work arrangements and to introduce a childcare benefit system for small businesses.
Various organizations, including the Korea Women Entrepreneurs Association, have put forth several recommendations. Park Chang-sook, president of the association, pointed out that government policy funding and investment are primarily focused on startups less than seven years old, which poses challenges for female entrepreneurs returning to work after childbirth, as they often face loan maturity extension refusals due to exceeding the seven-year mark. She called for the establishment of a system for extending loan maturities and deferring repayments for female business owners during childbirth and childcare.
Kim Myung-jin, president of the Korea Management Innovation Small and Medium Enterprises Association (MainBiz), stressed the urgency of policy support to promote employment in SMEs among young people. He noted that SMEs are facing a severe labor shortage, with unfilled positions reaching 93,000, and suggested providing incentives to bridge the wage gap between large and small enterprises, along with stable housing support and tailored welfare plans.
Kim Jin-oh, vice chairman of the Low Birthrate and Aging Society Committee, stated, "If the current population issues continue, South Korea will face a crisis in the next three to four years." He pledged to advocate for the voices of SMEs to be reflected in government policies and to propose solutions to the president. He emphasized the need for government support accompanied by policy and budget changes, as well as public awareness improvements to tackle this issue.
Kim Ki-moon, president of the Korea Federation of Small and Medium Businesses, remarked, "The low birthrate issue is a crucial task that must be addressed for the future of South Korea and is one of the most important agendas." He urged the Low Birthrate and Aging Society Committee to serve as a control tower for addressing the low birthrate issue and to develop necessary policies for the field.
* This article has been translated by AI.
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