Overdue wages hit all-time high in H1: data

(123rf)

South Korea recorded an accumulated over 1.04 trillion won ($764 million) in overdue wages in the first half of this year, marking the highest-ever figure in either half of a year, government data showed Thursday.

It marked the first time that overdue wages across the country had surpassed 1 trillion won, according to the Ministry of Employment and Labor. In total, 150,503 employees had overdue wages between January and June of this year.

Last year's overdue wages had already marked an all-time high, with 1.784 trillion won for all of 2023. The first-half figure for this year increased by 26.8 percent, or 220.4 billion won, compared to the same period last year.

The figure refers to accumulated overdue wages that occurred within a certain period of time, regardless of whether they have been taken care of at this point. The government report shows that 823.9 billion won -- roughly 78.9 percent -- of the overdue wages had been paid as of June.

About 219.8 billion won remains due to some 6,000 employees.

A continued economic slump in South Korea, particularly in the construction sector, is thought to have attributed to the record-high numbers in overdue wages. The accumulated contract amount in the domestic market for local construction companies in the first quarter dropped 28 percent compared to the same period last year, according to the Construction Association of Korea.

The Ministry of Land, Infrastructure and Transport in April showed that construction contracts in the country for 2023 fell by 18.9 percent compared to 2022, indicating a persistent slump in the sector.

As such, the overdue wages in the construction sector marked an on-year surge of 49.2 percent last year, and this year's first-half figure increased by 26 percent compared to the first half of 2023. A total of 247.8 billion won of wages was overdue in the first half, second only to 287.2 billion won in the manufacturing sector.

By Yoon Min-sik(minsikyoon@heraldcorp.com)