{"id":262171,"date":"2026-05-27T01:36:07","date_gmt":"2026-05-26T16:36:07","guid":{"rendered":"https:\/\/tenbizt.com\/en\/news\/uncategorized\/2026\/05\/27\/south-koreas-minimum-wage-battle-can-industry-specific-pay-save-small-businesses\/"},"modified":"2026-05-27T01:36:07","modified_gmt":"2026-05-26T16:36:07","slug":"south-koreas-minimum-wage-battle-can-industry-specific-pay-save-small-businesses","status":"publish","type":"post","link":"https:\/\/tenbizt.com\/en\/news\/politics\/2026\/05\/27\/south-koreas-minimum-wage-battle-can-industry-specific-pay-save-small-businesses\/","title":{"rendered":"South Korea’s Minimum Wage Battle: Can Industry-Specific Pay Save Small Businesses?"},"content":{"rendered":"

Translation result.<\/p>\n

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Minimum Wage Commission Holds Second Full Meeting in Sejong on the 26th<\/p>\n

\u201cDistinctions should be applied starting with vulnerable sectors\u201d<\/p>\n

\u201cApply the wage to all workers across the board\u201d<\/p>\n<\/div>\n

\"At\"\n<\/div>\n

Labor and business clashed over the scope of minimum wage coverage and proposals for industry-specific differentials at the commission\u2019s second plenary meeting to set the 2027 minimum wage.<\/p>\n

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On the afternoon of the 26th, the Minimum Wage Commission convened its second full session at the Government Sejong Complex to begin deliberations on the 2027 minimum wage.<\/p>\n

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Business representatives argued that weak domestic demand and mounting difficulties for small business owners warrant differentiated treatment by sector.<\/p>\n

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Ryu Gi-jeong, executive director of the Korea Employers Federation and an employers\u2019 representative, noted that while overall industrial production rose 1.7% in the first quarter of 2026 from the previous quarter, production in the hospitality and food service sector\u2014sensitive to domestic demand\u2014fell 1.3%. He said this was the largest decline since the third quarter of 2024.<\/p>\n

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Ryu added that the hourly minimum wage has already exceeded 10,000 KRW (\u2248$7.50) and, when weekly holiday pay is included, effective pay tops 12,000 KRW (\u2248$9.00). \u201cAt minimum, distinctions should be applied beginning with vulnerable sectors,\u201d he argued.<\/p>\n

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Yang Ok-seok, head of manpower policy at the Korea Federation of SMEs, warned of a small-business crisis. Citing a survey by the Ministry of SMEs and Startups and the Small Enterprise and Market Service, he said respondents reported an average annual operating profit decline of over 40%. He added that last year\u2019s closure payout from the Yellow Umbrella mutual aid totaled 1.485 trillion KRW (\u2248$1.11 billion)\u2014a record and a 64% increase over five years.<\/p>\n

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Yang relayed reports from the field that a family running two convenience stores, working 16 hours a day throughout the month, still takes home only about 2.5 million KRW (\u2248$1,875). He urged the commission to safeguard jobs in small and medium-sized enterprises and among small-business workers, who account for 80.4% of total employment.<\/p>\n

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By contrast, labor representatives demanded full minimum wage coverage for contract workers and a substantial wage increase.<\/p>\n

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Ryu Gi-seop, secretary-general of the Federation of Korean Trade Unions (FKTU), referenced the recent controversy over Samsung bonuses and argued that compensation gaps\u2014where bonuses exceed decades of a minimum-wage worker\u2019s salary\u2014cannot be explained by differences in entry path or luck.<\/p>\n

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He noted that over the past five years real economic growth was around 12%, while real wage growth was only about 2% and real minimum wage growth barely 0.1%. \u201cContracted workers\u2014including special employment types, platform workers, and freelancers\u2014must be covered by the constitutionally guaranteed protections of the minimum wage,\u201d he said.<\/p>\n

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Lee Mi-seon, deputy chair of the Korean Confederation of Trade Unions (KCTU), criticized the government for failing to submit results of the contracted-worker survey to the expert committee.<\/p>\n

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Lee said the commission had agreed last year to conduct the survey but has shown a passive, complacent stance\u2014citing concerns about social fallout ahead of the meeting\u2014rather than acting decisively.<\/p>\n

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She urged the commission not to let the minimum wage remain merely a number on paper, calling for a fair increase to protect the livelihoods of low-wage workers and for full application of the minimum wage to all workers.<\/p>\n

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Seong Jae-min, representing the public-interest committee members, called for calm, responsible deliberation based on objective data and sound reasoning, noting that both workers\u2019 cost-of-living pressures and the operational strains on micro-business owners are rising.<\/p>\n

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Before moving to substantive rate discussions at its next plenary meeting, the commission plans to continue debating the scope of coverage for contracted workers.<\/p>\n

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\u00a9 Dailian Co., Ltd. Unauthorized reproduction and redistribution prohibited.<\/p>\n