Workers, employers need to share burden
Next year’s minimum wage has been set at 9,160 won ($7.98) per hour, an increase of 440 won or 5.1 percent from this year’s 8,720 won. The Minimum Wage Commission announced the increase plan shortly after midnight Tuesday, failing to satisfy workers or employers.
Labor representatives demanded the minimum wage be raised to 10,000 won, as promised by President Moon Jae-in at the start of his administration. But employers insisted that the wage should be set at below 8,850 won in consideration of the growing difficulties faced by small- and medium-sized enterprises (SMEs) amid the persisting COVID-19 pandemic.
The commission’s final decision was based on the median level of 9,160 won proposed by representatives of the public. The proposal was passed in a vote by 14 members ― 13 in favor and one in abstention. Four members from the Korean Confederation of Trade Unions and nine from the business sector walked out of the meeting to protest the wage hike proposal.
Though labor and employers failed to narrow their differences, it appears the commission made the decision in consideration of both the prolonged coronavirus pandemic and the projected economic recovery for next year. Cheong Wa Dae explained that the decision reflected diverse factors including difficulties facing small business owners, low-income workers and sluggish job creation.
Professor Kwon Soon-won of Sookmyung Women’s University, who represented the public, said the commission came up with the wage hike proposal by considering various factors ― next year’s growth projection of around 4 percent and inflation of 1.8 percent.
The minimum wage stood at 6,470 won in 2017 when Moon took office and it rose 7.2 percent on average per year, compared to 7.4 percent seen during the previous President Park Geun-hye administration. To realize Moon’s minimum wage pledge, the government pushed to raise the wage sharply by 16.4 percent in 2018 and 10.9 percent in 2019, respectively.
Such a drastic hike in the minimum wage prompted a backlash from employers, especially smaller business operators, amid the spread of COVID-19. Then the wage rose by a meager 2.9 percent last year and 1.5 percent this year. Despite Moon’s vow to increase the wage, the administration has largely failed to tackle the adverse effects such as dwindling employment.
Small business owners in particular are expected to suffer from acute hardships due to the fourth wave of the coronavirus. A drastic wage hike will shrink employment. Both labor and business should compromise for coexistence by sharing the burden. The government, for its part, should take measures to assist small shop owners. It also needs to mitigate social discord and conflict between workers and employers.
Next year’s minimum wage has been set at 9,160 won ($7.98) per hour, an increase of 440 won or 5.1 percent from this year’s 8,720 won. The Minimum Wage Commission announced the increase plan shortly after midnight Tuesday, failing to satisfy workers or employers.
Labor representatives demanded the minimum wage be raised to 10,000 won, as promised by President Moon Jae-in at the start of his administration. But employers insisted that the wage should be set at below 8,850 won in consideration of the growing difficulties faced by small- and medium-sized enterprises (SMEs) amid the persisting COVID-19 pandemic.
The commission’s final decision was based on the median level of 9,160 won proposed by representatives of the public. The proposal was passed in a vote by 14 members ― 13 in favor and one in abstention. Four members from the Korean Confederation of Trade Unions and nine from the business sector walked out of the meeting to protest the wage hike proposal.
Though labor and employers failed to narrow their differences, it appears the commission made the decision in consideration of both the prolonged coronavirus pandemic and the projected economic recovery for next year. Cheong Wa Dae explained that the decision reflected diverse factors including difficulties facing small business owners, low-income workers and sluggish job creation.
Professor Kwon Soon-won of Sookmyung Women’s University, who represented the public, said the commission came up with the wage hike proposal by considering various factors ― next year’s growth projection of around 4 percent and inflation of 1.8 percent.
The minimum wage stood at 6,470 won in 2017 when Moon took office and it rose 7.2 percent on average per year, compared to 7.4 percent seen during the previous President Park Geun-hye administration. To realize Moon’s minimum wage pledge, the government pushed to raise the wage sharply by 16.4 percent in 2018 and 10.9 percent in 2019, respectively.
Such a drastic hike in the minimum wage prompted a backlash from employers, especially smaller business operators, amid the spread of COVID-19. Then the wage rose by a meager 2.9 percent last year and 1.5 percent this year. Despite Moon’s vow to increase the wage, the administration has largely failed to tackle the adverse effects such as dwindling employment.
Small business owners in particular are expected to suffer from acute hardships due to the fourth wave of the coronavirus. A drastic wage hike will shrink employment. Both labor and business should compromise for coexistence by sharing the burden. The government, for its part, should take measures to assist small shop owners. It also needs to mitigate social discord and conflict between workers and employers.
Meeting halfway
Source: Buhay Kapa PH
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