As the semiconductor industry enters a super-boom, the trade surplus is repeatedly hitting record highs. But nominal income is becoming more polarized, and real wages are slipping. Externally, Korea is in the "sun," but internally, a "shadow" is forming.
◇ Total income rose, but real wages per person fell
Real gross national income (GNI) in the first quarter of this year rose 13.2% from a year earlier. Real GNI reflects inflation and changes in export and import prices (terms of trade). With international semiconductor prices soaring vertically and exports increasing, real GNI appears to have climbed steeply as well.
But real wages, which reflect individuals' pocketbooks, are falling. The average real monthly wage per worker in June was 3,412,000 won, down 0.1% from last year (3,414,000 won). Real wages have declined for three consecutive months since April. Over the past 10 years (2016–2025), real wages had increased by an average of 1.34% per year.
This is analyzed as a result of growth being concentrated in the semiconductor industry, preventing real wages from rising across sectors. The Korea Development Institute (KDI) said, "Of this year's 3.2% economic growth rate, about 0.6 percentage point comes from the spillover effects of semiconductor growth, concentrating the expansion," adding, "Accordingly, while total income increased, the growth in real wages was modest."
Rising prices also held back gains in real wages. Real wages are calculated by subtracting the inflation rate from nominal wages. Due to the fallout from the Middle East war, inflation exceeded the Bank of Korea's target level for three straight months in April (2.6%), May (3.1%), and June (3.2%).
◇ Nominal income polarization at a six-year high… "Expected to deepen over the next 2–3 years"
Polarization in nominal income is also worsening. In the first quarter, the "equivalized disposable income quintile ratio" was 6.59 times, up from 6.32 times a year earlier. This is the highest for a first quarter since 2020 (6.89 times). This ratio shows how much the top 20% earn compared with the bottom 20%. A higher figure means income polarization is intensifying.
The Ministry of Data and Statistics (MODS) explained that holiday bonuses and performance-based pay concentrated in high earners, such as those working in the semiconductor industry, were the main drivers of this polarization. In the first quarter, the average monthly income of households in the top 20% (fifth quintile), where large-company workers are mainly concentrated, was 12,378,000 won, up 4.2% from a year earlier. In contrast, the average monthly income of households in the bottom 20% (first quintile) was 1,170,000 won, up only 2.7%.
There are also concerns that polarization may deepen going forward. Kang Sung-jin, a professor of economics at Korea University, said, "As the semiconductor boom continues, performance-based pay is likely to grow even larger, but the outlook for other industries is not bright," adding, "Over the next 2–3 years, polarization is expected to worsen further, so structural reforms and other countermeasures should be pursued."