SME Community: "Minimum Wage Must Be Frozen to Allow Us to Breathe" (Comprehensive)

Press Conference Held Urging Minimum Wage Decision for the Survival of SMEs and Small Business Owners

62.6% of SMEs and Small Business Owners Say "Minimum Wage Should Be Frozen or Lowered"

76.1% Say "Differentiated Application of Minimum Wage by Business Type Is Needed"

The small and medium enterprise community has called for a freeze on next year’s minimum wage, stressing the urgent situation faced by small and medium enterprises and small business owners.

On June 24, the Korea Federation of SMEs held a press conference at its Yeouido headquarters titled “Urging the Determination of Minimum Wage for the Survival of Small and Medium Enterprises and Small Business Owners,” making this demand. The event was attended by Lee Jaekwang, Chair of the Labor and Human Resources Committee at the Korea Federation of SMEs; Yoon Youngbal, Chairman of the Korea Vending Industry Cooperative and user representative on the Minimum Wage Commission; Geum Jiseon, President of the Korea Makeup & Beauty Society; Lee Gijae, President of the Korea Pet Industry Federation; and other representatives from various small and medium business sectors.

As the Minimum Wage Commission began its deliberations on wage levels on June 23, representatives of small and medium enterprises and small business owners who participated in the press conference issued an appeal, stating, “If small and medium enterprises and small business owners—the backbone of our economy—collapse, the entire working-class economy will fall apart.” They insisted, “To ensure that small and medium enterprises and small business owners can at least survive, next year’s minimum wage must be frozen at the current level.”

Representatives of small and medium-sized enterprises and small business owners participating in the press conference titled 'Urgent Call for Minimum Wage Decision to Ensure the Survival of SMEs and Small Business Owners' held on the 24th are reading an appeal. Korea Federation of Small and Medium Business

Regarding the proposal to apply different minimum wages by industry, which was rejected by the Minimum Wage Commission on June 18, they stated, “Due to opposition from labor groups and the commission’s passive attitude, no progress has been made,” and added, “We will continue our efforts to ensure that differentiated application by business type is implemented for the survival and recovery of vulnerable sectors.”

Geum Jiseon, President of the Korea Makeup & Beauty Society, read the appeal, saying, “Korea’s minimum wage is clearly high compared to other countries. The ratio of minimum wage to median wage is 60.5%, and if weekly holiday allowances are included, it becomes even higher. Now is the time to reflect on the circumstances of small and medium enterprises and small business owners who sustain the system, rather than increasing the minimum wage unconditionally.”

Yoon Youngbal, Chairman of the Korea Vending Industry Cooperative, stated, “The purpose of the minimum wage system established by law is to ensure the livelihood of workers, but the premise is that businesses must survive to maintain jobs. We are not trying to confront workers; we want to coexist.”

On this day, representatives from the manufacturing, retail, and convenience store sectors also took part in the press conference to share their on-the-ground difficulties. Kwak Inhak, Chairman of the Korea Metal Panel Industry Cooperative, said, “Right now, only a few big company sectors like semiconductors are doing well, while small and medium enterprises are experiencing negative growth. If manufacturing companies collapse, the shock will ripple through local economies and employment. The minimum wage could become a boomerang that threatens not only small business owners but also Korea’s entire manufacturing sector.”

Lee Gijae, President of the Korea Pet Industry Federation, commented, “In pet shops, owners are working more than employees, yet many take home less than 1 million won per month. Labor costs have now reached their limit.”

62.6% of Small and Medium Enterprises and Small Business Owners Say “Minimum Wage Should Be Frozen or Lowered”

The Korea Federation of SMEs also announced the results of a survey on “Difficulties and Opinions Related to Minimum Wage Among Small and Medium Enterprises,” conducted with 994 companies. According to the survey, 62.6% of small and medium enterprises and small business owners responded that the minimum wage for 2027 should be frozen or lowered. 77.6% said this year’s minimum wage was a burden on management, and 52.3% cited the rate of minimum wage increase as the main factor driving wage hikes.

Regarding how they would respond if the minimum wage were raised to an unsustainable level, 48.6% said they would reduce hiring, either by cutting back on new hires or downsizing existing staff. Additionally, 76.1% of small and medium enterprises and small business owners replied that differentiated application of the minimum wage by business type is necessary.

Lee Jaekwang, Chair of the Labor and Human Resources Committee at the Korea Federation of SMEs, commented, “Small and medium enterprises and small business owners feel as if they are passing through a tunnel with no exit, facing fourfold difficulties: high inflation, high oil prices, a weak won, and high interest rates. Raising the minimum wage without considering payment capacity doesn’t serve as a safety net for workers; rather, it could reduce jobs and push small and medium enterprises and small business owners to the edge.” He emphasized, “Next year’s minimum wage must absolutely be frozen at the current level, taking into account the conditions faced by small and medium enterprises and small business owners.”

This content was produced with the assistance of AI translation services.