Next Year's Minimum Wage 9,030~9,300 Won... 'Silent Endurance' Amid Labor and Management Dissatisfaction

Labor 'Only 40 Won' Retreat Fails to Exceed Park Administration's Increase Rate Under Moon Administration
Usage Already Dropped to 8,000 Won Range... Dedicated to Minimizing Ceiling Range in Remaining Negotiations

Public interest members of the Minimum Wage Commission, including Chairman Park Junsik, proposed a review promotion range of 9,030 to 9,300 won for next year's minimum wage at the 9th plenary meeting held on the afternoon of the 12th at the Government Sejong Complex in Sejong City. Workers' representatives, including Park Hee-eun, Vice Chairperson of the Korean Confederation of Trade Unions (KCTU) (center), are seen conversing during a brief recess. (Photo by Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] The public interest members of the Minimum Wage Commission proposed a minimum wage range of 9,030 won to 9,300 won for next year. This was suggested as an alternative due to the large gap between the minimum wage increase demands from labor and management. Within this range, the final minimum wage is likely to be decided in the low 9,000 won range. Compared to this year's minimum wage of 8,720 won, the increase rate is 3.6% to 6.7%. The labor sector may face criticism that the Moon Jae-in administration's pledge of a "10,000 won minimum wage" will ultimately not be achieved, while the management sector may be criticized for failing to maintain the 8,000 won range amid the COVID-19 situation. The labor sector is accelerating negotiations to ensure that next year's 6.3% increase results in an average increase rate under the Moon Jae-in administration that is higher than that of the Park Geun-hye administration. The 6.3% threshold corresponds to 9,270 won, so if it retreats by just 40 won from the current 9,300 won, the goal will fail.

On the afternoon of the 12th, the public interest members proposed this minimum wage deliberation facilitation range at the 9th plenary meeting held at the Government Complex Sejong. The minimum wage deliberation proceeds by narrowing the gap between the demands submitted by labor and management. When the public interest members propose a facilitation range, labor, management, and public interest members each submit their proposals within that range, and if no agreement is reached, a vote is held. Out of the total 27 members?9 each from labor, management, and public interest?at least 14 members must attend, and the proposal that receives the majority vote will be decided as next year's minimum wage.

The labor sector proposed 10,000 won as their third revised proposal that day. This represents an increase of 1,280 won (14.7%) from this year's minimum wage of 8,720 won. The management sector proposed 8,850 won as their third revised proposal. With a 1,150 won gap between the labor and management third revised proposals, the public interest members proposed the low 9,000 won range as the facilitation range. They set the lower limit at 9,030 won, which is 310 won (3.6%) higher than this year's minimum wage, drawing a line against the management's demand for the 8,000 won range. At the same time, they set the upper limit at 9,300 won, which is a 580 won (6.7%) increase.

In other words, this is closer to the labor sector's rationale between the management's insistence on maintaining the 8,000 won range and the labor sector's 6.3% increase (hourly wage of 9,270 won). Within the labor sector, there is a current of dissatisfaction that the public interest members' range is unreasonably low, even though they lowered their demand from 10,800 won to 9,300 won. However, as of 9:30 p.m., they have not walked out. Instead, remarks such as "The improving economic situation has not been reflected at all," and "The outlook has not been reflected at all in the situation where low-wage workers are held back by COVID-19," have been reported.