Impasse in minimum wage discussions underscores requirement for structural changes
In South Korea, the Minimum Wage for All campaign has been advocating for a significant increase in the minimum wage, with the proposed figure set at 11,500 won ($8.50) per hour. This represents a 14.7% rise from the current year's rate of 10,030 won.
On June 11, 2023, the campaign held a press conference and performance at the Sejong Center for the Performing Arts in Jongno District, central Seoul. The JoongAng Ilbo reported on this event.
However, the campaign's proposal has faced significant opposition, particularly from the business sector. While labor groups have slightly reduced their demand to 11,260 won (a 12.3% increase), the business side initially called for a freeze but later proposed a minimal increase to 10,090 won (a 0.8% rise). This leaves a substantial gap of 1,150 won per hour between the two sides.
The Minimum Wage Commission, which includes representatives of labor, management, and the public, is scheduled to meet on July 12, 2024, to discuss the proposed increase. However, the legal deadline for the Commission to finalize the rate was June 29, 2025, and no resolution has been reached, signaling an ongoing deadlock.
The stalemate has raised concerns about the potential impact on small businesses and self-employed shop owners, whose average monthly income is similar to the minimum wage’s monthly equivalent. Increasing the wage too much could push workers out of the formal system and lead to higher small business closure rates, which have already risen consecutively.
As the Minimum Wage Commission prepares to meet in July 2024, it remains to be seen whether a compromise can be reached, or if the actual increase in 2026 will be more moderate, balancing labor demands against economic realities faced by small businesses. The ongoing stalemate suggests that while the campaign’s ambitious goal highlights the need for better wage standards, a more nuanced approach may be necessary to ensure a balanced and sustainable economic future for all.
- The business sector, opposed to the Minimum Wage for All campaign's proposal, has called for a minimal increase instead of a freezing of the current minimum wage.
- In the upcoming Minimum Wage Commission meeting in July 2024, there is a question mark over whether a compromise can be reached, considering the opposition from the business side and the economic realities faced by small businesses.
- The general-news outlet JoongAng Ilbo reported on the campaign's press conference and performance at the Sejong Center for the Performing Arts, where they proposed a significant increase in the minimum wage.
- The ongoing deadlock in the Minimum Wage Commission, with no resolution reached by the legal deadline in June 2025, has raised concerns about the potential negative effects on small businesses and self-employed shop owners.
- The proposed increase in the minimum wage by the Minimum Wage for All campaign, if passed, could have a substantial impact on various sectors, including finance, business, politics, and even the arts, given the ripple effects on the general economy.
