S. Korea goes through unexpected wave of business shutdowns

(MENAFN) South Korea experienced an unprecedented wave of business closures in 2024, with over 1 million shop owners shutting down operations—a record high since statistics began in 1995, according to reports citing official data.

A total of 1,008,282 individual and corporate businesses filed for closure during the year, reflecting an increase of more than 21,000 from 2023. The figure marks the first time annual closures have exceeded the one-million mark.

The retail and food service sectors were hit hardest, accounting for nearly half of the total closures. Experts attribute the rise in shutdowns to long-term economic strain from the COVID-19 pandemic, coupled with a recent surge in interest rates and inflation.

The business closure rate rose slightly to 9.04% in 2024, up from 9.02% the previous year. Slumping sales were the leading reason, cited in roughly 50% of cases.

In another troubling sign, nearly 1,000 gas stations closed over the past six years, with the national total falling from 11,499 in 2019 to 10,528 by mid-2025.

Economist Kim Kwang-seok noted that persistently high borrowing costs and inflation have eroded household purchasing power, dragging down spending at restaurants and shops and ultimately weakening overall business profitability.

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