Real wages for workers have declined for four consecutive months as the rate of inflation has outpaced wage growth. Although the consumer price inflation rate has slightly decreased, the growth in nominal wages has also slowed, preventing any recovery in the real purchasing power of salaries.
According to the Ministry of Employment and Labor's 'August 2026 Business Labor Force Survey' released on September 30, the real wage per worker in businesses with at least one regular employee was 3,604,000 won in July, a decrease of 0.3% (12,000 won) compared to the same month last year.
Real wages are calculated by dividing nominal wages by the consumer price index, removing the effects of price fluctuations. Even if wages increase, if prices rise faster, workers' ability to purchase goods and services diminishes.
Monthly real wages increased by 0.1% compared to the previous year in March but have been on a downward trend since April, marking four consecutive months of decline. This is the first time real wages have decreased for more than four months since a five-month decline from April to August 2023.
While nominal wages have risen, they have not kept pace with inflation. In July, the nominal wage per worker was 4,316,000 won, an increase of 2.5% (104,000 won) from the same month last year. In contrast, the consumer price index rose by 2.8% year-on-year in July.
The consumer price inflation rate increased from 2.6% in April to 3.1% in May and 3.2% in June, before slowing to 2.8% in July. However, the growth rate of nominal wages also fell from 3.1% in June to 2.5% in July, preventing real wages from turning positive. The ongoing high oil prices following the Middle East conflict have contributed to the rising cost of living.
Wage disparities based on employment status were also evident. In July, the average wage for regular workers was 4,633,000 won, a 3.4% increase from the same month last year. Fixed salaries rose by 2.5% to 3,744,000 won, while overtime pay increased by 8.7% to 269,000 won, and special payments rose by 6.7% to 620,000 won.
In contrast, the wages of temporary and daily workers fell by 2.6% to 1,736,000 won compared to the same month last year, compounding the decline in real purchasing power due to rising prices.
There were also differences based on the size of the business. In companies with fewer than 300 employees, the average wage per worker was 3,846,000 won, a 1.7% increase, which was below the inflation rate for that month. In contrast, businesses with 300 or more employees saw an increase of 3.3%, bringing the average wage to 6,490,000 won.
Working hours have decreased. In July, the average working hours per worker were 161.9 hours, down by 7 hours (4.1%) from the same month last year, influenced by a reduction in the number of working days from 23 in July last year to 22 this year.
Job growth was primarily driven by temporary and daily workers. As of the end of August, the total number of employees in businesses with at least one worker was 20.69 million, an increase of 233,000 (1.1%) from the same month last year. Regular workers increased by 92,000 (0.5%), while temporary and daily workers rose by 141,000 (7.4%).
By industry, the health and social welfare services sector saw the largest increase, adding 122,000 workers. The professional, scientific, and technical services sector, as well as the finance and insurance sector, each added 28,000 workers. The manufacturing sector saw an increase of 17,000 workers, continuing a trend of growth since May.
Conversely, the wholesale and retail sector lost 30,000 workers, and the arts, sports, and leisure services sector saw a decrease of 7,000. The construction sector had 1,000 fewer workers compared to the same month last year, failing to maintain the previous month's growth.
* This article has been translated by AI.
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