The recent confirmation of a minimum wage increase for next year, coupled with discussions about allowing early morning delivery by large retailers, has heightened the sense of crisis among small business owners. With rising labor costs and intensified competition from major retail corporations, small business owners are calling for protective measures for local markets.
According to industry sources, the Small Business Federation submitted an objection to the Ministry of Employment and Labor on July 27, requesting a reconsideration of the minimum wage decision for 2027. The minimum wage committee has set the minimum wage for next year at 10,700 won per hour, a 3.7% increase (380 won) from this year. This translates to a monthly salary of approximately 2,236,300 won.
The federation estimates that businesses employing four workers will incur an additional labor cost of over 10 million won annually, including social insurance. This is expected to place a significant burden on local markets, which are already struggling with declining profitability due to the economic downturn. According to a survey by the federation, four out of ten small business owners reported average monthly operating profits of less than 2 million won. Song Chi-young, the federation's president, stated, "The minimum wage applicable in 2027 has completely surpassed the payment capacity of small business owners."
This is the first request for a reconsideration of the minimum wage since 2022. However, there is a prevailing belief that the likelihood of acceptance is low, as there has been no precedent for a reconsideration since the implementation of the minimum wage system.
Meanwhile, discussions in the government and political circles regarding the allowance of early morning delivery by large retailers have intensified, further amplifying the crisis among small business owners.
Lawmakers are forming a consensus that the regulations on large retailers should be rationally improved to align with the e-commerce-driven retail market environment. The need for offline retailers to regain competitiveness has been highlighted following Homeplus's corporate rehabilitation process, accelerating discussions on early morning delivery. The absence of nationwide elections until the 2028 general elections has also reduced the political burden of adjusting interests, lending momentum to the reform of regulations.
Small business owners are strongly opposing these developments. The Korea Supermarket Cooperative Federation criticized the policies as ignoring the realities of small supermarkets and local markets, asserting that allowing early morning delivery by large retailers would severely impact neighborhood supermarkets in both price and delivery competition. On July 28, various small business organizations, including the Korea Federation of Small Business and the Korea Mart Association, are set to hold a press conference at the National Assembly to officially express their opposition to the allowance of early morning delivery by large retailers.
Experts agree that policies significantly affecting local markets should be accompanied by protective measures for small businesses. Kim Dae-jong, a professor at Sejong University, suggested that "the minimum wage should be reviewed for differential application based on industry, region, and business size in the long term, and the allowance of early morning delivery by large retailers should be conditionally permitted during specific hours, premised on coexistence with small businesses." He added, "The key to such policies is to enhance consumer benefits and market competitiveness while ensuring that small businesses have time to adapt to changes, emphasizing the need for sufficient support measures alongside regulatory relaxation."
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.