Large companies hit bottom last year and rebounded… Shipments also show mixed results
Increasing dependence on loans… Vicious cycle of worsening profits due to high interest burden
Production at small and medium-sized enterprises has been decreasing for the second year in a row, failing to recover to pre-COVID-19 levels. This stands in contrast to the sharp increase in production at large companies, centered on exports such as semiconductors and automobiles.
According to the National Statistical Information Service (KOSIS) on the 18th, the average manufacturing small and medium-sized enterprise production index from January to July this year was 98.2.
The index is based on 100 in 2020. This means that small and medium-sized enterprise production is still lower than in 2020, the first year of COVID-19.
The manufacturing SME production index for January to July fell from 102.6 in 2019 to 97.7 in 2020, but then exceeded the baseline at 100.4 in 2021 and 100.7 in 2022.
However, after falling 2.2% to 98.5 last year, it has continued to decline for two consecutive years up to this year (-0.3%).
On the other hand, the production index of large corporations fell 7.6% from 115.2 in 2022 to 106.5 last year, but rebounded 6.8% to 113.7 this year.
Looking at it by quarter, the production index of large companies increased for four consecutive quarters from the third quarter of last year to the second quarter of this year. On the other hand, the production of small and medium-sized companies decreased for four consecutive quarters from the fourth quarter of 2022 to the third quarter of last year, and has been fluctuating since then.
The shipments of small and medium-sized companies and large companies were mixed. This year, the shipment index of small and medium-sized companies decreased by 1.5% from last year from January to July. On the other hand, the shipment index of large companies increased by 1.0%.
By industry, the semiconductor industry is driving overall manufacturing production. The average manufacturing production index from January to July this year increased by 5.6% compared to the same period last year, but excluding semiconductors and parts, it decreased by 0.2%.
As the difficulties of small and medium-sized enterprises continue, their dependence on loans has increased. According to the Bank of Korea, the amount of loans from banks to small and medium-sized enterprises from January to August this year was 37 trillion won. This is about 10 trillion won more than the amount of loans to large corporations (27.1 trillion won).
Production has decreased, but the profits of small and medium-sized enterprises have also deteriorated as they have to shoulder high loan interest costs due to high interest rates. Last year, 40% of all small and medium-sized enterprises failed to generate net profits, reporting ‘net profits of 0 won or less’.
(Sejong=News 1)
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2024-09-19 15:19:33