On July 15th, the increased minimum wages had been set. It was 7,530 won and was raised by 16.4 percent this year.President Moon insists that the minimum wage hike for next year is a green light for the minimum wage earners of 10,000 won. The minimum wage of 10,000 won represents the right to live decently. Some workers are delighted with the new policy. They had constantly asserted the minimum wages to be increased. However, it is not a pleasing news to small business founders and small and medium-sized business.
Some experts raise a voice of concern.
The increased minimum wages triggers small business founders to collapse. As the minimum wages increase, the expenses of companies will naturally increase. Many founders cannot cover to pay employees. According to their reasons, there will be a number of founders who cannot pay for the minimum wages and eventually close the business or reduce the number of employees.
There will be phenomenons that will occur in South Korea a few months from now. Therefore, the economy of South Korea will get worse. If the minimum wages increase, inflation will occur. Then, the effect of increased minimum wages will disappear. If worker's wage increased, the inflation problem will eventually cause the decrease of the consumption.
The government presented a counterplan for these problems based on three principles. The job stabilization fund, management downsizing and establishment of fair trade order are counterplans. Also, the government expects these counterplans can help the small business founders and prevent the increase of unemployment rate. However, these are far enough short for the founders. 'Whoever does not have, even what he has will be taken from him.' We need to consider the effects of the increase of minimum wages.
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