The purposes of this paper are to investigate mismatch in labor supply and demand on small and medium industries in Suwon region by conducting surveys to potential employees and employers, and to suggest alternative policy means to eliminate those mismatch conditions. Reasons of occupation change, difference in terms desired in occupation between potential employee and employer, understanding in mismatch, and measure of labor shortage by firms are analyzed in this paper. The report's recommendations to eliminate labor mismatch in small and medium industry are categorized into two groups: working conditions and occupation competence. Narrowing the working conditions gap, utilization of idle workers, establishment of flexible wage system are suggested to eliminate labor condition mismatch. In addition, potential employees need to meet working requirements by building up both wide use ability, occupation specific ability, and industry specific ability.