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| Kim Sang-jo, the presidential chief of staff for policy, delivers President Moon Jae-in's apology for not able to fulfill a key election pledge to raise minimum wage to 10,000 won within his term at a briefing in Cheong Wa Dae, Sunday. Yonhap |
By Kim Hyun-bin
President Moon Jae-in apologized Sunday for not being able to fulfill his key election pledge of increasing the minimum wage to 10,000 won ($8.48) during his term, pointing to economic and labor market uncertainty as the reason for this.
During the election, the President had promised to raise the minimum wage to 10,000 won an hour by 2020.
"We will not be able to reach the 10,000 won minimum wage within the remaining three years of my term. The Minimum Wage Committee looked in to numerous factors including the current economic and labor market situations, and I am sorry to say that I will not be able to keep the promise I made to the people," Kim Sang-jo, the presidential chief of staff for policy said on behalf of the president, during a media briefing.
On Friday, the 27-member commission, comprised of representatives of labor, management and civic groups, decided to raise the minimum wage by 2.9 percent to 8,590 won, the third-lowest increase since the system was introduced in 1988, leading to unions voicing their opposition.
Since then, the Minimum Wage Commission has been taking flak for failing to fully explain on how the 2020 minimum wage was set.
The committee only released a four-page summary that noted next year's minimum wage, the number of people who will benefit from the increase and a history of the basic income system. The summary failed to elaborate on how and why the increase level was decided on.
It was in stark contrast to how the commission explained the decision for this year's minimum wage ― an increase of 10.9 percent ― by releasing an in-depth summary of key decision making factors.
"We proposed a 2.87 percent increase because in the past two years there has been close to a 30 percent increase, and another big hike in the minimum wage would have had numerous side effects. So we sought to minimize any negative impact," management representatives said.
In a briefing, commission head Park Joon-shik merely reiterated the minimum wage decision, claiming it reflected a consensus for the need to flexibly respond to the current sluggish economy.
Lim Seung-soon, a standing member representing the public interest, said, "During the Asian financial crisis the business sector said the finance sector was problematic, but now it is blaming the sluggish economy."
"Currently, the trade war between U.S. and China and Japan's trade retaliation have impacted the economy. All these factors have been considered while making the decision."
Since Moon took office in May 2017, the minimum wage has risen by an aggregate 29.1 percent.
But the steep annual hikes were greeted by a strong backlash from small firms and convenience stores over increased labor costs and they responded by dismissing part-time workers, which hampered the country's job growth.
The Friday decision produced a strong protest from unions, which called Moon's pledge to increase the minimum wage to 10,000 won a "hollow slogan." ?
"If things continue this way, it will be difficult for Moon to keep his promise within his five year term," the Federation of Korean Trade Unions, a major umbrella labor group said.
