The Korea Enterprises Federation (KEF) said in a report on the 14th that the minimum wage to be applied next year should be differentiated by industry.
In its report, "The need for and implications of applying the minimum wage by industry," KEF noted that some industries, including food and beverage service, find it hard to bear the minimum wage, leading to sharply lower acceptance.
As grounds, KEF presented value added per employed person, the minimum wage level relative to the median wage, and the share of workers earning below the minimum wage.
Last year, value added per employed person in accommodation and food service was 28.45 million won, which was 17.1% of manufacturing (166.69 million won) and 16.2% of finance and insurance (175.61 million won).
The ratio of the minimum wage to the median wage also reached 87.1% in accommodation and food service, while it was in the 40% range in finance and insurance. KEF said the Organization for Economic Cooperation and Development (OECD) and the International Monetary Fund (IMF) have noted that when the minimum wage is excessively high compared with the median wage, negative effects such as job losses emerge.
The share of workers who do not receive the statutory minimum wage also varied widely by industry. Manufacturing was 3.7%, finance and insurance was 6.1%, but accommodation and food service reached 31.6%. The below-minimum rate in accommodation and food service rose sharply from 6.4% in 2001 to 31.6% in 2025. KEF explained that in this industry the current minimum wage is out of line with the field's payment capacity.
Business groups have been demanding industry-specific differentiation of the minimum wage for years. Last year, during discussions at the Minimum Wage Commission, they also proposed food and beverage service as a target for differential application of the minimum wage.
According to KEF, the minimum wage rose 437.8% from 1,865 won in 2001 to 10,030 won in 2025, reaching 5.7 times the inflation rate (77.4%) and 2.5 times the nominal wage growth rate (174.7%) over the same period.
KEF said, "Twenty-one OECD member countries apply differentiated minimum wages by industry, age, or region," and argued, "Korea should also raise the system's practicality through industry-specific differentiation."
Switzerland applies a level lower than the general minimum wage to agriculture and floriculture, and 10 OECD countries, including the United Kingdom, France, and Canada, apply a lower minimum wage to certain age groups than to general workers. Unlike major advanced countries that differentiate the minimum wage by multiple criteria, Korea allows only industry-by-industry application under the Minimum Wage Act.
Ha Sang-woo, a KEF director, said, "In a situation where payment capacity and productivity differ greatly by industry, applying the same minimum wage uniformly to all industries does not sufficiently reflect reality," and added, "For industries that find it difficult to bear the current level of the minimum wage, we should improve on-the-ground acceptance of the system through differentiated application."