In South Korea, a significant shift is occurring as an increasing number of older workers are leaving traditional employment to pursue self-employment. However, this transition is not leading to financial stability. Recent studies reveal that nearly half of these individuals earn less than the legal minimum wage, despite working full-time or more.

Financial Challenges in Self-Employment

A government-backed study by the Korea Employment Information Service (KEIS), released on March 18, 2025, highlights the financial difficulties faced by older South Koreans in self-employment. As of 2022, 48.8% of self-employed individuals aged 50 and over earned less than the minimum wage, which was then set at KRW1,994,440 per month (approximately USD1,360). This figure has likely increased, considering the 2025 minimum wage is set at KRW10,030 per hour, translating to a monthly wage of approximately KRW2,100,000 (USD1,430) based on a 40-hour workweek. ([news.bloombergtax.com](https://news.bloombergtax.com/payroll/s-koreas-2025-minimum-wage-set-at-10-030-won-hour-up-by-1-7?utm_source=openai))

Demographics of the Self-Employed

The KEIS report indicates that nearly 59% of new self-employed workers are aged 50 or older, suggesting that the majority of this transition occurs among older adults. Many of these individuals had spent decades in stable, salaried positions before retiring or being laid off. This trend reflects a broader issue of limited employment opportunities for older workers in South Korea. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

Income Disparities Among Self-Employed Workers

The study also reveals significant income disparities among self-employed individuals. For those in their 50s, 28.7% were earning below the minimum wage. Among workers aged 60 and over, this figure increased dramatically to 75.8%. These statistics underscore the financial instability that many older self-employed workers face. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

Nature of Self-Employment in South Korea

In South Korea, the term “self-employed” typically refers to small-scale operators running modest, labor-intensive businesses, such as corner convenience stores, fried chicken joints, small restaurants, hair salons, or street food stalls. These ventures are often initiated with retirement payouts or severance money, rather than venture capital. The barriers to entry for such businesses are low, but so are the returns. Over half (53.8%) of newly self-employed older workers entered low-margin, consumer-facing service sectors like food, lodging, and personal care. Many were former white-collar professionals—middle managers, office workers, or public servants—who, after exiting the salaried workforce, found few viable options other than running franchised convenience stores or bakeries. This common trajectory has given rise to a wry Korean saying: “In Korea, it all ends with a fried chicken shop.” ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

Business Structure and Income Outcomes

Income projections also varied based on business structure. Among the self-employed aged 50 and over who employed others, only 10.9% earned below the minimum wage. However, among one-person operations—solo entrepreneurs without employees—the share earning below the legal threshold increased to 56.3%. This disparity highlights the challenges faced by solo entrepreneurs in achieving financial stability. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

Declining Self-Employment Rate

Despite South Korea’s per capita income now exceeding USD32,000, its self-employment rate remains unusually high. According to 2024 data from the International Labour Organisation, 23.2% of South Korea’s workforce is self-employed, the sixth-largest portion among the OECD member countries. However, this rate is on a downward trend. In 2024, the proportion of self-employed individuals in the labor market fell below 20% for the first time in over 60 years, reaching 19.7%. This decline is attributed to the unprofitability of many self-employed businesses and difficulties in repaying loans taken out during the pandemic. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

Implications for the U.S. Workforce

The situation in South Korea offers valuable lessons for the United States, where an increasing number of older workers are also turning to self-employment due to limited opportunities in the traditional job market. Similar challenges, such as financial instability and income disparities, are evident among older self-employed individuals in the U.S. For instance, a 2023 study by the AARP found that 40% of self-employed workers aged 55 and over reported earning less than the federal minimum wage. This underscores the need for comprehensive support systems, including access to affordable healthcare, retirement planning resources, and business development assistance, to ensure that older workers can achieve financial stability in self-employment. Additionally, the U.S. can draw parallels with South Korea’s declining self-employment rate, which may indicate a broader trend of diminishing opportunities in the self-employment sector. Addressing these issues requires a multifaceted approach, including policy reforms, economic support programs, and initiatives to enhance the viability of small businesses.

What is the current proportion of self-employed individuals in South Korea?

As of 2024, self-employed individuals constitute approximately 19.7% of South Korea’s workforce, marking the first time this figure has fallen below 20% since 1963.([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

What challenges are older self-employed workers facing in South Korea?

Older self-employed workers in South Korea are encountering notable financial difficulties. A 2022 study revealed that 48.8% of self-employed individuals aged 50 and over earned less than the minimum wage, which was KRW1,994,440 per month at that time. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

How has the number of self-employed businesses changed recently?

In 2023, nearly 910,000 self-employed businesses closed, marking the highest number on record. This decline is attributed to unprofitability and challenges in repaying loans taken out during the pandemic. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

What is the average income of self-employed individuals in South korea?

Data from the National Tax Service indicates that 75.1% of self-employed individuals reported a monthly income of less than 1 million won ($762) in 2022. ([koreatimes.co.kr](https://www.koreatimes.co.kr/www/biz/2024/11/126_383387.html?utm_source=openai))

What measures are being considered to support self-employed workers?

the Financial Services Commission has announced plans to introduce measures aimed at easing the financial burdens of small business owners, in consultation with the banking sector. ([ajupress.com](https://www.ajupress.com/view/20241220140520691?utm_source=openai))