"Small Business Owners All Suffer" ... United Call for Minimum Wage Freeze (Comprehensive)

Sogongyeon, Minimum Wage Press Conference on the 12th
Claims for Sectoral Differentiation and Abolition of Weekly Holiday Allowance
"Labor Demands Unpayable"
"Government Should Subsidize 50% of Minimum Wage"

O Sehee, president of the Korea Federation of Micro Enterprise, and small business owners held a press conference announcing the 2024 minimum wage demand proposal on the 12th at the Korea Federation of Micro Enterprise in Yeouido, Seoul. Photo by Hyunmin Kim kimhyun81@

The small business sector unanimously agreed that next year's minimum wage should be frozen at this year's level (9,620 won). They also urged the implementation of sector-specific differentiated application and the abolition of the weekly holiday allowance.

The Korea Federation of Small and Medium Business held a press conference on the 12th at the Sogongyeon main conference room in Yeouido, Seoul, to announce their stance on the 2024 minimum wage. Chairman Oh Se-hee stated, "Considering the payment capacity of small business owners who are pushed to the brink, the minimum wage for next year must be frozen."

Chairman Oh noted that the minimum wage has risen nearly 50% from 6,470 won in 2017 to 9,620 won this year, and the number of one-person self-employed workers increased to 4,267,000 last year. Due to rising costs and declining sales, small business owners have reached their payment capacity limits to the extent that they choose to operate alone.

He also expressed that the differentiated application regulation stipulated in Article 4, Paragraph 1 of the Minimum Wage Act should be implemented. Chairman Oh said, "Small business owners barely surviving in a polarized economy centered on large corporations have no capacity to bear the burden caused by uniform minimum wage application." He emphasized, "Differentiated minimum wage application is essential so that they can secure service competitiveness, increase sales, and play a sustainable economic role."

They also conveyed the position that the weekly holiday allowance, which increases the burden on small business owners, should be abolished. Including the weekly holiday allowance, the hourly minimum wage already reaches 11,544 won, and it is desirable to abolish the weekly holiday allowance through legal amendments based on the principle of no work, no pay. They also pointed out that the weekly holiday allowance is a hotbed of various abuses such as splitting part-time jobs.

Chairman Oh demanded that the Minimum Wage Commission consider the labor productivity of small business owners alongside workers' living expenses when deciding the minimum wage level. In response to the labor sector's recent claim that next year's minimum wage should be 12,000 won, a 24.7% increase from this year, he rebutted, "This is not a realistically payable amount for small business owners."

O Sehee, president of the Korea Federation of Micro Enterprise, and small business owners held a press conference announcing the 2024 minimum wage demand proposal at the Korea Federation of Micro Enterprise in Yeouido, Seoul, on the 12th. Photo by Hyunmin Kim kimhyun81@

At the press conference, small business owners from various industries attended to convey the difficulties on the ground and support the call for freezing the minimum wage.

Yoo Eun-pa, director of a beauty salon, said, "Labor costs account for more than 60% in the beauty industry," adding, "Small and medium-sized beauty salons were hit hard and went out of business due to the minimum wage increase."

Director Yoo urged, "If the minimum wage is to be enforced in industries that pass on fingertip skills through an apprenticeship system, a certain training period should be granted, and during that period, the government should subsidize 50% of the minimum wage."

Lee Jong-hyuk, president of the Korea Association of Certified Realtors, expressed concern, saying, "With high interest rates, high exchange rates, heating cost bombs, and damages from the COVID-19 situation, raising the minimum wage will cause small business owners to be killed off again."

Bae Jeong-yeol, CEO of a bakery business, said, "Bakeries are in extreme situations, reducing staff and shortening operating hours," and raised his voice, "If you want to raise the minimum wage, raise it where large corporations with lots of money dominate, and freeze it for small business operations."

Oh Doo-su, head of the Gyeonggi-do branch of the Korea Accommodation Industry Association, also stated that differentiated minimum wage application is necessary considering the nature of the accommodation industry, which operates 24 hours a day. He said, "If the minimum wage is raised, the accommodation industry will all go out of business," and added, "I hope the wage system will be differentiated."

Jung Dong-gwan, CEO with over 20 years of experience in the food service industry, said, "Considering the weekly holiday allowance, the minimum wage has far exceeded 10,000 won," and demanded the government choose either freezing the minimum wage or abolishing the weekly holiday allowance.