Korea applies a single national rate — 10,320 won per hour in 2026
Japan sets rates across 47 regions; France ties hikes to prices and wages
Income supplements, insurance relief and productivity investment support also in play
As deliberations over South Korea's 2027 minimum wage enter their final stretch, attention is turning to how other major economies structure their systems. Korea applies a single uniform rate regardless of region, industry or age, while the United States and Japan set rates by region and the United Kingdom differentiates by age. France ties adjustments to price and wage indicators, and Germany relies on a standing labor-management commission to draw up recommendations.
The Minimum Wage Commission received the ninth round of revised proposals from both labor and management at its 13th plenary session on Thursday. Worker representatives proposed 11,220 won per hour — 8.7 percent above this year's rate — while employer representatives offered 10,530 won, a 2.0 percent increase, narrowing the gap to 690 won. The 14th plenary session is scheduled for Tuesday. The current 2026 minimum wage stands at 10,320 won ($7) per hour, or 2,156,880 won per month based on 209 working hours — a 2.9 percent increase from last year.
Yang Ok-seok, head of the human resources policy division at the Korea Federation of SMEs, said Friday he expects a final decision on Tuesday. "The minister's official notice must go out in early August, and working backward from the two-week objection period, a decision absolutely must be made by the 14th at the latest," he said. "Since the minimum wage has already risen to around the median wage level, I expect the two sides will find common ground somewhere near the rate of inflation."
Minimum wage systems abroad vary considerably. The United States sets a federal minimum wage as a baseline, with individual states free to set their own higher rates. The federal minimum has stood at $7.25 per hour since July 2009. In practice, however, the minimum wage regime carries less market weight in the United States than in Korea — employers in many areas find it difficult to hire workers at the federal floor, which is why the rate has gone more than a decade without an increase and drawn relatively little public backlash.
To supplement low-wage workers' incomes, the United States operates the Earned Income Tax Credit. Workers who meet income and household eligibility requirements can reduce their tax liability, and those whose credit exceeds their tax bill receive the difference as a refund. The system pairs regionally set minimum wages with a federal work-linked tax credit.
The United Kingdom differentiates its minimum wage by age and apprenticeship status rather than by region. The National Living Wage, which applies to workers 21 and older, rose to 12.71 pounds per hour from April this year. Workers aged 18 to 20 receive 10.85 pounds, while those aged 16 to 17 and apprentices each receive 8 pounds per hour.
Even within the same workplace, the statutory minimum can differ depending on a worker's age or apprenticeship status. Minimum wage levels are recommended to the government by the Low Pay Commission, which comprises employer representatives, worker representatives and independent experts. The commission gathers input from businesses, workers and local communities before assessing the impact on employment and the broader economy. The British government accepted all of the Low Pay Commission's recommendations for 2026.
Japan sets minimum wages separately across its 47 prefectures. Under the regional rates currently in effect for 2025, Tokyo's minimum stands at 1,226 yen ($8) per hour, while Kochi, Miyazaki and Okinawa sit at 1,023 yen — a maximum regional gap of 203 yen. Japan also operates a business improvement subsidy program that links wage increases at small and medium-sized enterprises to productivity investment support.
France applies a single national minimum wage known as the SMIC. The current 2026 rate is 12.3 euros ($14) per hour, with a monthly minimum of 1,867 euros based on a 35-hour workweek. Minor workers with less than six months of professional experience in a given sector may receive a lower rate depending on their age. The SMIC is adjusted each January, reflecting both consumer price inflation for the bottom 20 percent of households by income and changes in the purchasing power of average hourly wages for blue- and white-collar workers. If the consumer prices index rises 2 percent or more after the most recent adjustment, an automatic mid-year increase of the same magnitude is triggered.
Germany, like Korea, applies a single national minimum wage. This year's rate is 13.9 euros per hour, rising to 14.60 euros in January 2027. A standing minimum wage commission that includes employer and worker representatives reviews the rate every two years, with the government implementing changes through statutory order. Separate minimum wages may also be set under sector-level collective bargaining agreements.
hong@heraldcorp.com
