Seoul: Nearly two-thirds of self-employed small business owners report worsening business conditions this year and are advocating for a freeze or reduction in the minimum wage, a recent poll revealed.
According to Yonhap News Agency, a survey conducted by the Federation of Korean Industries (FKI) indicated that 63.4 percent of 500 respondents observed a deterioration in business conditions compared to the previous year. A mere 6.8 percent noted improvements, while 29.8 percent stated that conditions remained unchanged.
The survey further explored the impact of the current minimum wage on businesses. Half of the respondents described the wage burden as heavy, 30.6 percent considered it moderate, and 19.4 percent did not find it burdensome.
Industry-specific data showed that businesses within the lodging and food services sector felt the most pressure, with 64.2 percent citing a significant burden. This sentiment was echoed by 51.9 percent in wholesale and retail, 50 percent in education services, and 48.4 percent in manufacturing.
Regarding the future of the minimum wage, 59.2 percent of participants supported freezing or reducing it. Specifically, 44.2 percent favored a freeze, while 15 percent advocated for a reduction. The current minimum wage stands at 10,030 won (US$7.37) per hour.
Additionally, 30.4 percent of respondents reported earning below the current statutory minimum wage, translating to approximately 2.1 million won monthly, based on a standard 40-hour workweek.
An FKI official emphasized the need for a cautious approach in determining the minimum wage for the upcoming year, highlighting the importance of considering employers' capacity to pay and the broader labor market conditions.
The Minimum Wage Commission, which includes labor, management, and public representatives, has been negotiating since April to establish the national minimum hourly wage for 2026. Labor representatives are advocating for a 14.7 percent increase to 11,500 won, while management is pushing for a wage freeze.