Small Employers Cut Working Hours After Minimum-Wage Hike

      May 09, 2018 13:47

      Most jobs advertised online are part-time positions, suggesting that small restaurants and convenience stores are opting to hire staff only for a few hours a day as the minimum-wage hike kicks in.

      A growing number of employers resort to this strategy, which results in no improvements in the wages of part-time workers.

      The minimum wage rose 16.4 percent in January from W6,470 to W7,530 an hour (US$1=W1,079). Employers must also give extra allowances to staff working more than 15 hours a week. Instead, small businesses are either cutting work hours of existing staff or splitting them to two or three-hour shifts and hiring additional part-timers.

      The actual work hours of part-time workers are decreasing. Part-time job search portal Alba recently surveyed 5,510 workers and found that the average work week stood at 20.5 hours in January compared to 21.9 hours in 2017.

      A coffee shop owner puts up a flyer seeking a part-time worker in Seoul on Tuesday.

      For the employers, the minimum-wage hike does not translate only into rising hourly wages but also other linked costs such as weekly allowances. Many smaller employers respond by splitting up work hours and hiring more part-time workers to reduce extra entitlements.

      Staff who work eight hours a day are being replaced by two people who work two to three hours a day, and some employers hire several part-time employees working two days a week just to ensure that one staffer does not work more than the 15 hours that entitle them to the allowances.

      That is especially prevalent in restaurants, coffee shops, hospitals, beauty salons and other small minimum-wage businesses. One beauty salon in Daejeon opted to hire only part-timers in the mornings because that is when discounts are offered to attract customers during the quiet times.

      And a small restaurant in Seoul hired a part-timer to work only three hours a day from noon to 3 p.m. when the lunch crowd comes to eat. Last year, part-timers there worked six hours a day, but the owner said, "I worked alone after letting a part-time worker go early this year, but it was so hard that I decided to hire a part-timer for just a few hours a day."

      A lot of self-employed people are posting questions in online communities about such hiring practices, and there are also more websites where employers can post ads for short-term part-time jobs. One app provides a service to instantly connect part-timers with employers.

      But jobseekers are not happy. Lee Jin-soo (30) tried to find a place where he could work more than six hours a day, but most of the jobs he was able to find lasted only for two or three hours a day. Eventually, he had to get two jobs -- one in the morning and one in the afternoon. "The cost of transportation to and from work is burdensome," Lee said.

      Despite the hefty minimum-wage hike, the average monthly income of part-time workers in January rose only 2.1 percent from December to W713,043.

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