Self-employed storefronts across Seoul are contracting as weak domestic demand, high interest rates and rising rent, labor and material costs squeeze neighborhood businesses. The Seoul Metropolitan Government's commercial district analysis service counted 624,791 storefronts in the second quarter, down 38,682, or 5.83%, from 663,473 in the fourth quarter of 2023. The total peaked after the pandemic and has declined for 10 consecutive quarters through the second quarter of this year, with the net figure already accounting for new openings. Nail salons fell 20.93% to 4,247, while pubs, clothing shops, chicken restaurants, internet cafes, seafood shops, mobile phone retailers and real estate brokerages also contracted. Declines were sharpest in outer districts that rely more on local spending, led by Eunpyeong at 9.03% and Gangbuk at 8.66%. By contrast, skin care salons, sports clubs and pet-related businesses expanded, reflecting a shift in consumption toward health, personal care and pets. The Bank of Korea's second consecutive monthly rate increase lifted its base rate to 3% from 2.75%, raising borrowing costs and reducing household spending power. Economists say part of the contraction reflects an unwinding of pandemic-era oversupply and recommend re-employment and vocational training over indiscriminate support for new businesses.