Minimum wage hikes to help ease income polarization: minister
SEOUL, (millat online):South Korea’s commerce minister said Tuesday that raising the minimum wage for entry-level jobs will help ease income polarization among workers and rev up domestic consumption in Asia’s fourth-largest economy.
Paik Un-gyu, minister of trade, industry and energy, made the remark during a visit to an industrial complex in Ansan, 42 kilometers south of Seoul, where he met small business owners and their employees.
Beginning this year, the minimum hourly wage was raised to 7,530 won (US$7) from last year’s 6,470 won as part of efforts to increase household income and boost domestic demand.
“Minimum wage hikes are essential to achieve income-led growth by easing social polarization and improving labor conditions,” Paik said. “The government will collect opinions and recommendations from local industries to help implement the new wage policy as soon as possible.”
Seoul officials have advocated for the new policy as critics have expressed concerns that steep hikes in the minimum wage could be a burden to businesses and could adversely affect low-income workers as their employers may opt to cut staff.
The government said it will create an employment settlement fund worth 3 trillion won to help ease the financial burden on small and medium-sized enterprises.