Large Firms’ Generous Performance Bonuses Drive Average Annual Salary for Workers Past 50 Million Won for the First Time

No. 1: Financial and Insurance Sector at 93.87 Million Won

Wage Gap Widens by Industry and Company Size

Last year, for the first time, the average annual total wage for full-time workers in South Korea surpassed 50 million won. This increase was driven primarily by a sharp rise in special bonuses, such as performance-based pay.

According to the "2025 Analysis of Wage Increase Characteristics by Workplace" report released by the Korea Employers Federation (KEF) on March 22, the average annual total wage for full-time employees last year was 50.61 million won, a 2.9% increase compared to the previous year. Full-time employees include contract workers with contracts of at least one year, regular employees, and permanent contract workers. The annual total wage figure is calculated by adding regular pay and special bonuses, then converting the monthly average into an annual amount.

The key factor behind wage growth was special bonuses. The increase rate for regular pay was 2.7%, which was lower than the previous year's 3.2%. However, the increase rate for special bonuses jumped to 4.3%, a significant rise from just 0.4% the previous year. In particular, large corporations with 300 or more employees saw a surge in performance-based bonuses. Special bonuses at large companies rebounded from a 2.0% decrease in 2024 to a 5.8% increase last year, reaching a record high of 18.43 million won. As a result, the annual total wage increase rate for large companies also rose from 2.2% to 3.9%.

In contrast, small and medium-sized enterprises (SMEs) experienced a slowdown in wage growth. The annual total wage increase rate for businesses with fewer than 300 employees dropped to 2.5%, down from 3.0% the previous year. Both regular pay and special bonuses saw slower growth, at 2.5% and 2.3%, respectively. Consequently, the wage gap widened again. The average annual salary at large companies was 73.96 million won, while that at SMEs was 45.38 million won, meaning SMEs reached only 61.4% of the large company average when the latter is set at 100.

By industry, the financial and insurance sector recorded the highest average wage at 93.87 million won, while the accommodation and food service sector had the lowest at 31.75 million won—a gap of 62.12 million won. This was followed by the electricity, gas, and steam supply sector (91.03 million won), professional, scientific, and technical services (68.73 million won), and information and communications (63.84 million won), all of which had high wage levels.

Over the long term, wage growth has substantially outpaced inflation. Compared to 2011, last year's annual total wage increased by 58.9%, and the hourly wage rose by 77.7%, about two times and 2.6 times the cumulative inflation rate of 29.8% over the same period, respectively. The reduction in working hours made the increase in hourly wages feel even more significant.

The KEF noted that if the wage growth structure continues to shift toward performance-based bonuses without corresponding improvements in productivity, companies could face increasing cost burdens.

Ha Sangwoo, Head of Economic Research at KEF, stated, "The total wage has exceeded 50 million won for the first time, and special bonuses have reached an all-time high," adding, "We must improve productivity by expanding job- and performance-based wage systems and increasing flexibility in working hours."