"I Don’t Think We’ll Be Able to Hire Part-Timers" ... Minimum Wage Fallout Sparks Outcry Among Small Business Owners, Cheers Among Part-Time Workers

[Financial News] "Everything has gone up — ingredients, delivery fees, rent — and now labor costs are rising too. At this point, I really can’t even imagine hiring people."
Lee, who runs a Korean restaurant in Jongno District, Seoul, said he plans to stop nighttime operations next year and run the store with just his spouse. He said this with frustration.
As next year’s hourly minimum wage was finalized at 10,700 won, up 3.7% or 380 won from this year, tension is rising across the self-employed sector, especially in food service and other service industries. Small business owners, already burdened by rent and franchise and delivery fees, now face higher labor costs as well. Many are signaling job cuts and a shift to unmanned operations, raising expectations that structural changes in the restaurant industry will accelerate further. Part-time workers, meanwhile, are welcoming the move in anticipation of higher real income.
According to industry sources on the 15th, the increase decided the previous day by the Minimum Wage Commission broke with the recent trend of gradual stabilization and pushed the annual increase rate back above 3% for the first time in three years.
The year-on-year minimum wage increase slowed from 5.0% in 2023 to 2.5% in 2024 and 1.7% in 2025, but after rising 2.9% this year, the pace will widen to 3.7% next year.
In particular, the long-demanded "industry-specific minimum wage system" failed to materialize, making damage to restaurants, lodging businesses, and other sectors with weak payment capacity appear unavoidable.
Choi, who runs a barbecue restaurant in Seoul Gangnam-gu, let out a sigh as soon as he heard the news of the wage hike. He said, "Nothing has gone down — raw material costs, rent, gas bills — and now hourly wages are going up too. It even makes me wonder whether I should just close the shop." He added, "Starting next year, I may have to cut staff even on weekdays and keep the store running alone."
The self-employed sector is already nearing its limit. According to National Tax Service data, the annual number of business closures by individual and corporate operators has exceeded 1 million. Retail businesses, at 30.0%, and food service businesses, at 15.2%, account for nearly half of all closures among key neighborhood commercial sectors.
The pace of adopting unmanned systems such as kiosks, table-order devices, and serving robots is also expected to accelerate further.
Park, who runs a restaurant in Jung District, Seoul, said, "There will be upfront rental costs and maintenance fees for the machines, but if you consider the monthly labor expenses, going unmanned seems far more profitable than hiring people. That’s why I’m now thinking about bringing in new equipment."
On the other hand, part-time workers such as college students and job seekers are welcoming the increase. With housing and living costs rising in an inflationary environment, they expect the higher hourly wage to provide some breathing room.
Kim, a convenience store part-timer, said, "Prices have gone up so much that even with an hourly wage of 10,000 won, it’s hard to afford a single meal. So seeing take-home pay increase is a welcome change."
Still, some worry that even if the hourly wage rises, it may become harder to find jobs at all, or working hours may be cut, leaving total income lower than before.
ssuccu@fnnews.com Kim Seo-yeon Reporter