Part-Time Jobs Dwindle After Minimum-Wage Hike
04 October, 2018
Part-time jobs at the bottom of the market are dwindling after the drastic minimum-wage, further reducing the prospects of young people in an already tough job market.
Job ads for part-time workers in fast-food restaurants fell 13 percent from January to September compared to the same period of 2017.
Analysis of the database of temp job portal Alba shows that 8.5 million job ads were posted in the first nine months of this year, compared to 9.72 million a year ago. That is equivalent to just 87 ads a day compared to 100 last year. The number of working hours also decreased. Part-timers worked 16.4 hours on average this year, compared to 22 in 2017.
A closer look shows that job ads declined 13 percent in the first quarter of this year, 10 percent in the second and 16 percent in the third. Sung Tae-yoon at Yonsei University said, "Cost pressure aggravated by the minimum wage hike is having a negative impact on hiring especially for low-paying jobs."
The sharpest drop was in convenience stores, which are often the first port of call for young jobseekers. From January to September of 2017, convenience stores posted 694,084 job ads for part-timers, but that plunged to 462,328 in the first three quarters this year.
According to a study by the Korea Labor and Society Institute, the average hourly wage in convenience stores rose from W6,562 to W7,598 after the government increased the minimum wage to W7,530 this year (US$1=W1,122).
The situation is little better elsewhere in retail. The combined number of ads for part-time jobs in convenience stores, restaurants, fast-food joints, coffee shops, beer pubs and Internet cafés dropped by 710,000.
A common trait of these businesses is that they are usually small outlets run by individuals either independently or on a franchise basis and cannot boost productivity over a short period to cover the rising labor costs.
On Worknet, a job portal run by the Labor Ministry and the Korea Employment Information Service to support employment in small and mid-sized companies, the situation is similar. Some 1.69 million jobs were posted on Worknet from January to August, down 14 percent on-year. After rising briefly in January, job postings have dwindled steadily.
Cho Joon-mo at Sungkyunkwan University said, "Businesses that tried to deal with the minimum wage hike are instead spending money on vending machines or kiosks," which save them labor costs in the longer term.
At fast-food chain Lotteria, 25 percent of total revenues last year were generated through automated kiosks, and that rose to 40 percent this year.
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