Almost half of South Korea’s small businesses to axe jobs in 2019

Following the revised Minimum Wage Act, which resulted in a higher minimum wage, South Korean small businesses are struggling to stay afloat.
By: | January 8, 2019
Topics: Compensation and Benefits | News | Recruitment | South Korea

 

South Korean small businesses are struggling with the country’s new labour law, according to a survey by Incruit, an online recruiting service.

The survey was conducted soon after government approval of the revised Minimum Wage Act, which boosts the minimum wage. It also requires provisions for paid leave for employees, taking their weekly working times into consideration.

Almost half (47%) of the 240 self-employed entrepreneurs polled are planning to reduce headcount or limit recruitment this year as a result.

The survey also revealed that a vast majority (93%) said that the new wage system will affect their management decisions.

About 7% said that they are considering shutting down their businesses altogether.

The top concern indicated by about a quarter (24%) of the businessmen polled was the increase in the minimum wage.

In contrast, last year’s top concern in a similar poll was the increase in rent, at 17%.