S. Korean Youth Shying Away From Entrepreneurship

Survey reveals stark contrast with China, U.S. as young Koreans prioritize stability over risk.

A recent survey highlights a concerning trend: young South Koreans are increasingly hesitant to pursue entrepreneurship, unlike their counterparts in China and the United States, who are more eager to start their own businesses.

Diverging Attitudes

The joint survey by the Federation of Korean Industries (FKI) and the JoongAng Ilbo, which polled 2,103 young adults across Korea, the United States, Japan, and China, found that only 12.2 percent of Korean respondents had ever attempted to start a business.

That figure is significantly lower than the 35.1 percent in the United States, 29.4 percent in China, and 16.4 percent in Japan.

According to **Wang Jin**, a 30-year-old Chinese entrepreneur, “In China, seeing the success of AI startups like DeepSeek, more people are thinking, ‘I could be next.’ A corporate job is a good experience, but it’s not a lifelong goal — my dream is to build my own business.”

Fear of Failure

In South Korea, the primary barriers to entrepreneurship are fear of failure (34.9 percent), a preference for job stability (34 percent), and difficulty securing funding (18.2 percent). Even those who do start businesses often focus on low-margin, domestic services like restaurants and retail (35.2 percent).

In contrast, young Americans and Japanese individuals tend to favor knowledge-based sectors like content creation (26.9 percent and 29.1 percent, respectively), while Chinese youth are drawn to tech-driven fields such as AI and IT (35.1 percent).

As **Nam Dae-il**, a business professor at Korea University, notes: “During Covid-19, you could launch a startup with just an idea. But now investors demand higher technical competence, and inexperienced entrepreneurs are turning to subsistence ventures, mainly within the domestic market.”

Struggles and Setbacks

One Korean entrepreneur in his 30s, who launched an AI-driven cosmetics recommendation platform, had to shut down his business after only a year. “The idea was great, but the gap between the vision and reality was too wide,” he said.

“Outsourcing development cost billions of won, and even when I hired developers in Vietnam, they didn’t grasp the concept. You need at least some proof of concept to attract investment, but it took about a year just to develop a demo version, and I couldn’t hold on that long,” he lamented.

Government Efforts Fall Short

Despite President **Lee Jae Myung’s** pledge to transform Korea into a leading venture powerhouse, youth entrepreneurship is declining. New business registrations fell 4.5 percent last year, with those by people under 30 dropping by 12.9 percent—the largest decrease across all age groups.

“Since late 2022, venture capital has been drying up, and investors now prefer stable ventures with quick returns,” explained **Na Su-mi**, a researcher at the Korea SMEs and Startups Institute.

The lack of tech-focused startups is hurting South Korea’s Unicorn status. According to the Global Unicorn Index 2024, South Korea accounts for just 2% of the world’s Unicorns, compared to the US with 51% and China with 17% (Hurun Research Institute).

Systemic Issues

“Unless we reform the startup ecosystem and foster a tech-friendly environment, individual entrepreneurship won’t translate into economic growth,” said **Chung Chul**, CRO of FKI and President of the Korea Economic Research Institute.

When asked about preferred career paths, Korean youth ranked conglomerates first, followed by public sector jobs, with entrepreneurship coming in last.

Over half (55.7 percent) of Korean respondents expressed no interest in launching or even considering a startup, while American and Chinese youth showed strong entrepreneurial ambition. Korean and Japanese respondents leaned toward job security.

**Oh Min-do**, 32, who ran a food delivery startup, said he lost tens of millions of won within a year. “I didn’t understand market analysis, costs or taxes,” he said. “Now I feel like I’m two or three years behind my peers. I’ll never try again.”

“Most of my friends want to work for old, stable companies with large workforces,” said **Hikari Miyanaga**, 25, a Japanese student.

Other Contributing Factors

More than half (54.9 percent) of Korean respondents still live with their parents. Koreans also had the latest ideal age for financial independence, at 27.9 years, compared to 26.4 in the U.S., 26.8 in Japan, and 27.1 in China.

Korea’s average entrepreneurial perception score was 57.6 out of 100—lower than China’s 61.6 and America’s 67.3.

“Young Koreans tend to see entrepreneurship as something only for a select few,” said **Kim Young-eun**, head of the entrepreneurship center at the FKI. “We need to promote entrepreneurship as a universal value through education, culture and policy.”

Experts are calling for stronger institutional support for failed entrepreneurs. “Youth founders face disproportionate financial risks after a single failure,” said **Han Joseph**, a researcher at the Korea Development Institute. “But Korea lacks effective re-employment or second-chance startup programs.”

**Nam Jung-min**, a professor of entrepreneurship at Dankook University, argues that the responsibility is too scattered across multiple ministries. “We need clearer and more cohesive policy support,” he said.