“Screams of small businessmen… Please reduce the rent even”… Small business owners, 7 out of 10 suffered severe’sales decline’

Coronavirus economic shock CG.  Photo = Yonhap News
Coronavirus economic shock CG. Photo = Yonhap News

[뉴스워치] Seven out of 10 small business owners reported a decline in sales this year due to the new coronavirus infection (Corona 19).

In particular, it was found that the fixed cost, which they felt the most economically, was rent.

According to the results of the’Survey on the Impact of Small Businesses Related to Corona 19′ released by the Federation of Small Businessmen on the 27th, 70.8% of respondents said that this year’s sales “lowered” than last year. On the other hand, only 0.7% of respondents said that’sales increased’.

28.5% answered’no change’. The average rate of decrease in sales of small business owners who suffered a decrease in sales was 37.4%.

The rate of decrease in sales of small business owners and the rate of decrease in sales by industry.  Source = Federation of Small Businessmen
The rate of decrease in sales of small business owners and the rate of decrease in sales by industry. Source = Federation of Small Businessmen

Leisure service industry showed the highest sales reduction at 43.9%, followed by education service industry (40.4%), lodging and restaurant business (39.5%), and wholesale and retail sales (35.3%).

Rent (68.8%) was the most common answer to financially burdened fixed costs (multiple responses), followed by △labor expenses (54.1%) △various taxes (50.6%) △loan interest (14.8%).

47.3% of the major uses of the subsidies received from the government or local governments were also cited as the most frequent rental fee. (9.0%) and so on.

Regarding business hours, 91.4% answered that there was no change, and the decrease (8.1%) and increase (0.6%) were relatively small. The business hours are the same, but the decrease in sales means that labor productivity has declined.

87.3% showed no change in the number of employees, but 12.3% decreased. The response that the number of employees decreased was relatively high at 21.9% and 15.1% for the lodging and restaurant business and the leisure service business, respectively.

An indicator of anxiety and depression experienced by small business owners.  Source = Federation of Small Businessmen
An indicator of anxiety and depression experienced by small business owners. Source = Federation of Small Businessmen

What’s eye-catching is that it deals with the mental health problems that small business owners experience. So Gong-yeon, for the first time in this survey, measured and announced mental health problems such as anxiety and depression.

The degree of depression of small business owners based on the depression measurement tool was found to be 20.2% of the depression risk group. It is an immediate result indicator by summing up the degrees corresponding to depression items such as’insomnia’,’fatigue’,’slow speech and behavior’,’suicide thoughts’, and’no interest or pleasure’.

This is higher than that of the general population at risk of depression due to Corona 19 at 18.6%. This means that small business owners are more depressed than ordinary people.

The result of measuring the degree using an anxiety disorder screening tool showed that 17.1% of the respondents belonged to the anxiety risk group.

Small business owners with high symptoms of anxiety and depression were also more likely to close their business. Two of the three businesses (67.6%) expressed their intention to continue operating their business despite Corona 19, but 31.7% of businesses were considering closing their business or planning to close it.

0.7% of businesses actively expressed their intention to close their business. As a result of the analysis of small performances, it was found that the more severe the characteristic depression was, the higher the intention to close the business. So Gong-yeon analyzed that psychological damage such as anxiety and depression acts as a significant variable that increases the intention to close the business, and it is urgent to come up with a remedy to manage the degree of depression.

Chairman Kim Im-yong, acting chairman So Gong-yeon, urged, “As small business owners are burdened with rent, emergency support measures such as direct rental support and a large expansion of emergency loans should be implemented quickly.”

Meanwhile, the survey was conducted by requesting a polling company Beyond Research, and it was conducted with 1018 small businessmen from October 19th to November 5th.

Reporter Kim Joo-kyung newswatch@

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