Next Year's Minimum Wage Rises 380 Won to 10,700 Won Per Hour... Monthly Total 2,236,300 Won (Summary)

14th Plenary Meeting Held at Government Complex Sejong on July 14
Final Decision Adopted Employers' Proposal After Vote
Labor Side: "Effectively a Freeze When Considering Inflation"

Next year, the minimum wage will be set at 10,700 won per hour, up 380 won (3.7%) from this year.

The Minimum Wage Commission held its 14th plenary meeting at the Government Complex Sejong on July 14 and reached this decision. Including the weekly holiday allowance, the hourly rate rises to 12,840 won, and calculated monthly (based on 209 hours), it amounts to 2,236,300 won.

Previously, for the initial demands for next year's minimum wage, labor unions called for a 16.3% increase to 12,000 won, while the employers' federation proposed keeping it at this year's rate of 10,320 won.

Both sides presented twelve revised proposals leading up to the meeting, narrowing the gap to 130 won, but were ultimately unable to reach an agreement.

Ryu Kijeong, Executive Director of the Korea Employers Federation (KEF) and a user member of the Minimum Wage Commission, is drinking water at the 14th plenary meeting of the Minimum Wage Commission held at the Government Complex Sejong on the 14th. Photo by Yonhap News

The public interest members then suggested a "deliberation promotion zone" with a lower limit of 10,600 won and an upper limit of 10,860 won. The 2.7% lower limit reflected this year's projected inflation rate of 2.7%.

The 5.25% upper limit was calculated by adding the average projected economic growth rate for this year (2.55%), as provided by the Bank of Korea (2.6%) and the Korea Development Institute (2.5%), to the same inflation rate forecast of 2.7% by both institutions.

Despite this, the gap between labor and management could not be bridged. The public interest members recommended that both sides agree at 10,720 won. However, consensus was not reached and the minimum wage for next year ultimately went to a vote.

Of the 27 members from labor, management, and public interest groups who voted, the employers' proposal of 10,700 won garnered the most support with 15 votes, compared to the labor representatives' proposal of 10,730 won, which received 11 votes. Thus, 10,700 won was set as the minimum wage for 2027. There was one invalid ballot.

On the 14th, at the 14th plenary meeting of the Minimum Wage Commission held at the Government Sejong Complex, Ryu Kisub, Secretary General of the Federation of Korean Trade Unions and labor representative, is listening to the remarks of Ryu Kijeong, Executive Director of the Korea Employers Federation and employer representative. Photo by Yonhap News Agency

The labor side expressed strong dissatisfaction with the outcome. Ryu Kisup, Secretary General of the Federation of Korean Trade Unions, said, "A 3.7% increase in the minimum wage falls far short of adequately reflecting the dire livelihood reality for low-wage workers; it's a very disappointing decision," adding, "Considering inflation, it is effectively a freeze." He continued, "We deeply regret this minimum wage decision and will fight to guarantee the right to survive for low-wage workers and to eliminate blind spots in minimum wage protection."

The Korea Employers Federation, representing business owners, also expressed regret. "Given the financial limitations and management difficulties faced by small businesses and SMEs, as well as their limited payment capacity, the rate should have been frozen. We regret that this was not accepted," the federation said. "However, the final decision reflects not only the recent inflation trends but also employers' efforts to minimize the business burden and employment contraction resulting from the wage hike—a difficult but inevitable choice reached after much deliberation."

The Korea Federation of Micro Enterprises also voiced strong objection, stating, "We regret the decision to further raise the minimum wage, ignoring payment capabilities. This increase will immediately intensify the wage burden, deepen management difficulties, and become a heavy shackle for small business owners."

Meanwhile, the 3.7% increase in next year's minimum wage is 0.8 percentage points higher than last year (2.9%). Over the past five years, the annual minimum wage increases were: 9,160 won in 2022 (5.05%), 9,620 won in 2023 (5.0%), 9,860 won in 2024 (2.5%), 10,030 won in 2025 (1.7%), and 10,320 won in 2026 (2.9%).

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