South Korean SMEs Face Tighter Chuseok Cash Flow as Bonus Plans Fall

  • South Korean SMEs reported worsening Chuseok cash conditions and fewer bonus plans this year.
  • 45.1% of SMEs planned Chuseok bonuses, while average funding covered 78.44% of needs.
  • Korea Enterprises Federation found 76.5% of surveyed companies planned four-day closures.

South Korean SMEs are entering this year’s Chuseok holiday with tighter cash flow, weaker bonus plans and a sizable funding gap, according to a Korea Federation of SMEs survey of 1,000 businesses conducted from the 1st to the 7th of this month. Only 45.1% planned to pay Chuseok bonuses, while 40.0% said their cash situation was more difficult than last year. SMEs needed an average of 256.45 million won, or approximately $190,000, to cover holiday-related funding needs but could secure 197.97 million won, leaving a shortfall of 58.48 million won. Manufacturing companies faced larger requirements and gaps than non-manufacturers. The survey differs from a separate Korea Enterprises Federation poll of 601 companies with at least five employees, which found that 61.0% planned bonuses and 76.5% planned four-day Chuseok closures. Together, the surveys show weaker conditions among SMEs while highlighting differences across business samples.

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