South Korea’s small and medium-sized enterprise (SME) sector is expanding mainly through solo and micro-enterprises rather than through companies that hire and scale. At the end of 2024, the SME population reached 8,499,552, up 2.4% year on year, while employment increased just 0.04% to 19,124,806. Solo enterprises rose 3.5% to 6,666,023 and represented 78.4% of all SMEs, while firms with two or more employees declined 1.4%. A separate July 2026 employment analysis showed the same structural divide: companies with 1–4 employees added 210,000 workers year on year to reach 10.227 million, whereas companies with 5–299 employees lost 166,000 to reach 15.466 million. Large enterprises with 300 or more employees added 65,000 workers to reach 3.444 million. The figures point to pressure on growth-stage businesses that normally expand production, sales, investment and employment before becoming mid-sized or large enterprises. Researchers and experts have called for policy support to help solo businesses become employers and to measure assistance by companies’ growth rather than the number of recipients.