Small Business Community Regrets Decision to Further Raise Minimum Wage Without Considering Payment Capacity

Korea Federation of Micro Enterprises Voices Opinion on 2027 Minimum Wage Decision

The small business community has expressed regret over the decision to set the minimum wage for 2027 at 10,700 won per hour, a 3.7% increase from this year, saying, "This is a decision that ignores the desperate pleas of 7.9 million small business owners who are struggling to survive each day amid record levels of debt and sluggish economic conditions."

On July 15, the Korea Federation of Micro Enterprises stated in a press release that the 2027 minimum wage, "when including weekly holiday allowance, amounts to 12,840 won per hour, and the monthly amount now exceeds 2.2 million won." They further noted, "This surpasses the inflation rate, fueling price increases and threatening the small business sector, which forms the backbone of the national economy."

Small Business Owners Opposing Minimum Wage Increase Yonhap News

The federation pointed out, "The minimum wage has been raised every single year for over 40 years without exception," adding, "With no funds available to pay out, but mandatory labor costs rising due to the minimum wage, small business operators are facing increasingly harsh business conditions, while employment is actually declining."

The small business sector asserted that higher rates of minimum wage increases are putting jobs for vulnerable groups at even greater risk, arguing that the necessity of the minimum wage system itself must be fundamentally reconsidered. The federation also expressed regret over the failure to introduce 'differentiated minimum wage rates by industry,' stating, "Major countries around the world set minimum wages flexibly by region, industry, and skill level. Yet, due to opposition from labor groups and political interests, the irrational insistence on a single nationwide system in Korea continues every year."

The federation continued, "Responsibility for this situation lies with the government and the National Assembly, which have left the outdated minimum wage system unchanged for over 40 years." They demanded, "The government and the National Assembly must immediately pursue fundamental reforms in the minimum wage decision-making structure, such as adopting biennial determinations, establishing sector-specific minimum wages, reflecting small business owners' payment capacity, and strengthening the representation of small business interests."

The federation further urged the government to devise practical and comprehensive support measures to ease the burden on small business owners, such as reinstating job stability subsidies to offset additional minimum wage increases and expanding financial support for business stability.

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