Half of new businesses disappear in two years

Only about half of new firms in the country survive through their first two years, data from Statistics Korea showed.

The smaller they were the faster they perished.

Only three out of 10 businesses run by individuals with zero regular employees carried on after five years, whereas those with at least one regular employee showed a higher survival rate of 45.2 percent.

Accommodation and restaurant businesses, many of which are run on a shoestring, showed the lowest survival rate of 17.9 percent after five years.

Of some 5.3 million firms operating as of last year, 51.1 percent were run by people in their 50s or older, up from 40 percent in 2006, as retired baby boomers went on to start their own businesses, according to Choi Sung-wook, an official at Statistics Korea.

The share of firms run by those aged below 50 fell from 59.6 percent to 47.9 percent in the same period.

By Kim So-hyun (sophie@heraldcorp.com)