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S. Korea sees record-high No. of new businesses by senior citizens

By Yoon Min-sik

Published : June 11, 2024 - 17:58

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A photo on Sunday shows the view from an apartment complex in Songpa-gu, Seoul. (Yonhap) A photo on Sunday shows the view from an apartment complex in Songpa-gu, Seoul. (Yonhap)

The number of enterprises founded by those aged 60 and above marked a record-high number in the first quarter this year, government data showed Tuesday, despite the overall number of new businesses continuing to decline.

According to Statistics Korea, a total of 276,000 new companies were founded in the first quarter, excluding those related to real estate. Of those, 38,000 were founded by people aged 60 and older, marking the highest figure ever.

It was also the first time ever that new enterprises created by senior citizens accounted for at least 13 percent of the total figure.

When it comes to statistics related to the newly founded enterprises, the government conventionally tallies both the total figure and another excluding businesses related to real estate. This is because the real estate law change of 2020 led to a massive surge in the number of real estate agencies, many of which folded quickly in the following years.

As such, including real estate-related firms in the official tally can potentially distort the current state of the local economy.

For example, 96,697 new enterprises were founded in the first quarter of 2020 by those aged 60 or above, more than double the 42,372 in the first quarter of 2019. But when excluding real estate firms, the increase was a more modest rise from 28,040 to 30,033 in the same period.

The rising number of new enterprises by senior citizens comes as yet another indicator that the country's population is rapidly aging. February data from Statistics Korea showed that 58 percent of those that were newly employed in 2023 were in their 60s, marking the highest figure ever.

As figures indicate that an increasing number of older people are working, the overall number of new companies has continued to increase. The number of newly founded enterprises in the first quarter of this year was 7.8 percent less than in the same period in 2023, and has decreased in every quarter since the first quarter of the year.

When including real estate businesses, 300,600 new enterprises were founded in the first quarter of this year. In this case, the figure has decreased every quarter since the first quarter of 2022.