Lee Mi-sun, a worker representative on the Minimum Wage Commission and vice chairwoman of the Korean Confederation of Trade Unions, holds up a sign reading "12,000 won (about $8) minimum wage over a Kospi 10,000!" during the commission's eighth plenary session at the Government Sejong Building on Tuesday. [Yonhap]
Lee Mi-sun, a worker representative on the Minimum Wage Commission and vice chairwoman of the Korean Confederation of Trade Unions, holds up a sign reading "12,000 won (about $8) minimum wage over a Kospi 10,000!" during the commission's eighth plenary session at the Government Sejong Building on Tuesday. [Yonhap]

SME federation holds press conference calling for minimum wage freeze

Survey of 994 firms: 62.6% say rate should be frozen or cut

76.1% back sector-differentiated rates after June 18 vote fails

More than six in 10 small businesses and self-employed operators want the 2027 minimum wage frozen or reduced, a new survey shows, as the Minimum Wage Commission begins deliberations on next year's rate. Nearly half said they would cut new hires or reduce existing staff if the wage rises to an unmanageable level.

The Korea Federation of Small and Medium Business (KBIZ) released the findings Wednesday at a press conference at its Yeouido headquarters in Seoul, calling on the commission to freeze the minimum wage at its current level.

The event was attended by Lee Jae-gwang, chairman of KBIZ's labor and workforce committee, along with employer representatives on the Minimum Wage Commission — including Yun Yeong-bal, chairman of the Korea Vending Machine Operators Cooperative; Geum Ji-seon, chairwoman of the Korea Make-up Artists Association; and Lee Gi-jae, chairman of the Korea Pet Industry Federation — as well as other industry representatives from the small business and self-employed sectors.

Participants noted that the commission began reviewing wage levels Tuesday and urged that next year's minimum wage be held at the current rate. In a joint appeal, they said, "If small businesses and self-employed operators — the backbone of our economy — collapse, the entire livelihoods of ordinary people will collapse with them," adding that they were calling for a freeze "so that small businesses and the self-employed can at least breathe."

The group also pushed back against the commission's rejection on June 18 of a proposal to apply differentiated minimum wage rates by industry. KBIZ said the measure "has not moved a single step forward due to opposition from labor and the commission's passive stance," and vowed to keep pressing for sector-specific rates "to ensure the survival and recovery of vulnerable industries."

KBIZ also released results of a survey of 994 small businesses and self-employed operators on minimum wage burdens and opinions. The survey found that 62.6 percent of respondents said the 2027 minimum wage should be frozen or lowered.

Some 77.6 percent said this year's minimum wage is a burden on business operations, and 52.3 percent cited the pace of minimum wage increases as the main driver of rising labor costs. KBIZ argued that the cumulative strain of labor costs means any further increase could undermine the hiring capacity of small businesses and self-employed operators.

When asked how they would respond if the minimum wage rose beyond a level they could absorb, 48.6 percent said they would reduce employment — either by cutting new hires or laying off existing workers. Representatives from manufacturing, wholesale and retail, and convenience store sectors also shared their experiences with labor cost pressures and operational difficulties.

Some 76.1 percent of respondents said differentiated minimum wage rates by industry type were necessary. KBIZ argued that applying a single uniform rate across all sectors places a disproportionate burden on vulnerable industries, given that their ability to pay and workforce structures differ significantly.

"Small businesses and the self-employed feel like they are passing through a tunnel with no exit, battered by four simultaneous crises — high prices, high oil costs, a high exchange rate and high interest rates," said Lee Jae-gwang, the committee chairman. "A minimum wage increase that ignores the ability to pay is not a safety net for workers — it can backfire by cutting jobs and pushing small businesses and the self-employed to the edge of a cliff."


hong@heraldcorp.com