The photo shows a rental sign posted on a building near Jonggak Station in Seoul, Dec. 25. Yonhap

The number of newly established companies in Korea declined for the third consecutive year in 2023 amid a prolonged economic slowdown, data showed Friday.

Approximately 956,000 businesses were launched last year, representing a decrease of 42,000, or 4.2 percent, compared with the previous year, according to the data compiled by Statistics Korea.

The agency said the continued downward trend reflects a slower-than-expected recovery in the economy following the COVID-19 pandemic.

By industry, the number of newcomers in the real estate sector fell by the most, dipping 17.1 percent on-year, followed by the transportation and warehouse sector with 9.9 percent.

The proportion of newly established companies out of all business entities came to 12.7 percent in 2023, the lowest level since the government began compiling relevant data in 2011.

In 2022, only 64.9 percent of companies created in 2021 made it through the following year.

Approximately 751,000 firms permanently closed in 2022, marking a 2.1 percent increase from the previous year, according to the data.

The real estate sector experienced the largest decline, with 25,000 firms shutting down, a 14 percent decrease compared with the previous year. (Yonhap)