Smart factories drive Korea SMEs to reshore overseas plants
The digitalized facility cut production costs by an average of 15.5%, raising productivity and quality by 28.5% and 42.5%, respectively, according to the Ministry of SMEs and Startups. Companies with the plants added 2.6 employees on average and reduced industrial accidents by 6.2%.
“It is urgent to increase productivity per capita by upgrading to smart factories since the falling working-age population is weakening the manufacturing sector’s competitiveness in the mid to long term,” said Noh Min-sun, a research fellow at the Korea Small Business Institute. Local SMEs see the system as a solution to cope with risks from the global supply disruption, the COVID-19, surging commodity prices.