Convenience Store Owners Nervous About Next Year's Minimum Wage Discussions...

About 70% of Self-Employed for Livelihood
Sales per Store Remain Flat
Growing Interest in Differential Application by Industry and Region

On the afternoon of the 6th, various products are displayed at a convenience store in downtown Seoul.

[Asia Economy Reporter Lim Chun-han] “It’s not just us; everywhere is in turmoil. The minimum wage has risen so much that if we want to reduce labor costs, family members have no choice but to work at the store.”

On the afternoon of the 6th, Mr. Lee, who operates a convenience store in Songpa-gu, Seoul, said, “Rent and labor costs are the biggest parts of the store’s profitability,” adding, “Since the COVID-19 pandemic, profits have dropped significantly, so we are currently employing only the minimum number of part-time workers.”

As deliberations on next year’s minimum wage have begun, convenience store owners are once again anxious about potential labor cost increases. On the ground, there is growing concern that the prolonged COVID-19 situation, which has already made things difficult, could push some stores to close down. Convenience stores typically operate 24 hours a day, making them one of the industries most sensitive to minimum wage hikes. According to the industry, about 70% of convenience stores are run by self-employed operators who rely on the store for their livelihood.

Although consumer spending at convenience stores increases every year, sales per store have stagnated. This is due to intensified competition among convenience stores and rising costs such as rent and labor. According to the Ministry of Trade, Industry and Energy, the average purchase amount per person at convenience stores increased by 26.3%, from 5,544 won in 2017 to 7,001 won in 2021. However, sales per store only rose by 0.3%, from 48.5 million won in 2017 to 48.63 million won.

The biggest point of interest in this minimum wage discussion is the differential application by industry and region. Currently, some countries such as the United States, Canada, Japan, Belgium, and Australia implement differentiated minimum wage systems. President-elect Yoon Suk-yeol stated during his presidential campaign that “a progressive review of differential application by industry and region should begin.” Since President-elect Yoon has advocated for minimum wage differentiation, the industry holds high expectations. However, there are predictions that designing a differentiated minimum wage system will not be easy and that social consensus will be difficult to achieve.

An official from the convenience store industry said, “If the minimum wage increases again during these difficult times caused by the COVID-19 pandemic, it will be a heavy burden for store owners,” adding, “We need to watch how the system for differential application by industry and region will be designed.”

This content was produced with the assistance of AI translation services.