In a rare meeting with about 160 owner-operators and small business owners at Cheong Wa Dae, Thursday, President Moon Jae-in promised to reflect their opinions in deciding the minimum wage. His promise came in response to growing complaints about soaring labor costs.
The President also vowed to issue 18 trillion won ($16 billion) worth of gift certificates that can be used only at small stores, and introduce an unemployment relief system to strengthen the social safety net for the self-employed.
It was the fourth time in less than two months that President Moon met with representatives of the business community. The chief executive's frequent meetings with businesspeople are desirable by itself because sympathy and communication are the first steps toward finding a solution.
Particularly welcome was Moon's pledge to take into account small business owners' views in deciding the minimum wage. The steep hikes in the minimum wage ― 16.4 percent last year and 10.9 percent this year ― have posed considerable burdens on small business owners. Moon's promise is seen as an intention to slow down the pace of wage increases.
Finding answers to other problems is never easy, however. There are about 5.6 million self-employed in Korea, almost one in every four employed people. Most of them are retired wage earners who failed to prepare for their later years and jumped into the already saturated market of convenience stores, coffee shops and restaurants. A downward business cycle and cutthroat competition usually drive almost 80 percent of novice entrepreneurs out of business within a year.
All this shows why the government's countermeasures have hit a wall. A more fundamental solution is to bolster economic growth and revitalize domestic demand, drawing retired workers back to the job market and helping increase the incomes of those already working.
Worse yet, the global economy is also likely to slow down this year, hit by China's expected economic slowdown, the U.S.-China trade war and an increasingly uncertain outlook for Brexit. A perfect storm may hit the Korean economy. Policymakers, lawmakers, politicians and businesspeople should join forces to get Korea out of adversity as soon as possible.