Number of mid-sized firms increases in 2020 amid waning sales

The number of mid-sized firms in South Korea went up in 2020 from a year earlier, but their sales dipped due to the coronavirus pandemic, government data showed Monday.

Asia's fourth-largest economy had 5,526 mid-sized companies as of the end of last year, up 519 from a year earlier, according to the data from the Ministry of Trade, Industry and Energy.

Mid-sized firms here refer to those which have average annual sales of 40 billion won ($33.9 million) to 150 billion won over the past three years.  

Manufacturing companies numbered 1,977, or 35.8 percent of the total, with nonmanufacturing businesses taking up the remainder.

Despite the increased number, mid-sized firms' sales declined by 11.5 trillion won on-year to 770 trillion won last year, as manufacturers were hit hard by the COVID-19 outbreak. South Korea reported the first case of the new coronavirus in late January last year.

Their combined operating profit thus shrank 6.3 percent on-year to 37.1 trillion won, but their total workforce rose by 95,000 to 1.578 million as of end-December.

Mid-sized firms' investments edged down from the previous year to 26.7 trillion won last year, with the ratio of spending on research and development gaining by 1.6 percentage points to 28.9 percent.

In the wake of the coronavirus outbreak, those companies plan to cut back on their overall investments, but their R&D spending is expected to keep rising down the road, according to the data. (Yonhap)