[2020 National Audit] Average Starting Salary for New Employees 38 Million KRW, but Executive Pay Gap Worse than OECD

9 Public Institutions under the Ministry of SMEs and Startups Show Up to 5.6 Times Salary Gap Between Senior and Junior Positions
OECD Average Wage Gap is 3.4 Times, Higher Than 1st Place USA (5 Times)

[Asia Economy Reporter Kim Heeyoon] It has been confirmed that the salary gap between the highest and lowest ranks within nine public institutions under the Ministry of SMEs and Startups exceeds 5.6 times.

According to the "2019 Average Salaries of Executives and New Employees" submitted on the 23rd by nine public institutions under the Ministry of SMEs and Startups to Lee Juhwan, a member of the National Assembly’s Industry, Trade, Energy, SMEs and Startups Committee from the People Power Party, the average salary of new employees was about 38.56 million KRW, while the average salary of executives was 189.63 million KRW, showing a gap of more than 4.9 times on average.

Considering that the average wage gap between the top and bottom 10% in 12 OECD member countries in 2019 was 3.4 times, this represents a significantly large disparity.

The institutions with the highest average executive salaries were ▲Korea Technology Finance Corporation at 251.3 million KRW ▲Korea Institute of Startup & Entrepreneurship Development at 204.72 million KRW ▲Korea SMEs and Startups Agency at 215 million KRW ▲Korea Venture Investment Corp at 191.36 million KRW ▲Korea Institute for Advancement of Technology at 188.28 million KRW, in that order. The institution with the lowest was ▲Small Enterprise and Market Service at 125.67 million KRW.

The average salary gap between executives and new employees by institution was highest at ▲Korea Institute for Industrial Economics & Trade at 5.6 times, followed by ▲Korea Institute of Startup & Entrepreneurship Development at 5.5 times, ▲Korea Technology Finance Corporation at 5.3 times, and both ▲Korea SMEs and Startups Agency and ▲Korea Institute for Advancement of Technology at 5.1 times. These figures exceed the wage gap of the United States (5 times), which has the largest wage disparity among OECD member countries. The Korea Small and Medium Business Distribution Center showed the lowest gap at 3.8 times, but all nine public institutions under the Ministry of SMEs and Startups were confirmed to have higher gaps than the OECD average.

Assemblyman Lee said, "The wage gap between executives and employees in public institutions under the Ministry of SMEs and Startups far exceeds the OECD average, showing a fragmentary example of income polarization in our country," and added, "Measures should be prepared to reduce the gap by considering the appropriateness of wage levels."