This report details the South Korean Minimum Wage Committee's decision on the 2026 minimum wage, including the labor-management agreement process and economic context.
On July 10, 2025, the Minimum Wage Committee set the 2026 minimum wage at 10,320 won per hour (2.9% increase, 290 won raise). This equals 2,156,880 won monthly (based on 40 hours/week, 209 hours/month). This marks the first agreement without voting since 2008, with the committee comprising 27 members (9 each from public, labor, and employer representatives).
During negotiations, labor initially demanded a 14.7% increase while employers proposed 0% (freeze), showing a significant gap. The final decision was based on 2025 economic projections: 0.8% economic growth, 1.8% consumer price inflation, and 0.4% employment growth. This minimum wage affects approximately 2.9 million workers (13.1% of all workers).
Labor groups criticized the low increase rate, with the Democratic Labor Federation strongly opposing it and the Korean Confederation of Trade Unions requesting additional worker support policies. Employers acknowledged the compromise while seeking government support. The new minimum wage takes effect January 1, 2026.
The report emphasizes the significance of achieving agreement without voting for the first time in 17 years amid slowing economic growth and inflation, demonstrating that minimum wage policy has become an important venue for social dialogue.