The Lens: South Korea’s minimum wage plan for foreign domestic workers sparks debate

In light of the ageing population and low birth rate, South Korea has launched a pilot programme guaranteeing minimum wage to foreign domestic helpers to address labour shortages in the country’s care industry.

However, this merely burdens households rather than addressing the cause of the labour shortage.

The pilot programme will prioritise sending foreign domestic workers to dual-income married couples, single-parent households and multi-child families with the highest demand for help with housework. Yet, many of these families may need help to afford the wages for domestic workers, which could discourage them from hiring help or even having children.

Families usually provide live-in domestic workers with meals, accommodation and other necessities, which adds to the overall cost. It raises concerns over the sustainability of this programme.

Establishing a high minimum wage could disincentivise hiring foreign domestic workers. Many workers are ready to accept lower wages, which are higher than what they would make in their home countries. This is an opportunity for them to work abroad and provide for their families. The minimum wage would provide fewer opportunities for potential candidates.

Rather than relying on this pilot programme for foreign domestic workers, the government should focus on offering more financial incentives to young couples to encourage childbearing. Improvements in free education and affordable child necessities could support parents significantly, fostering a more family-friendly environment.

Hopefully, the government has meticulous plans for addressing the labour shortage because of its far-reaching economic and social impact.

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Product placements and fleeting trends once flooded social media platforms. But the novelty of endless consumption has worn off, and a new narrative has emerged on these sites that were once the gateway to excessive shopping. Now, young Asian consumers are embracing a countermovement: underconsumption.

Lim Yi Ying, a 35-year-old Singaporean business owner, said she used to spend more than S$1,000 (US$767 or HK$6,000) on Singles’ Day sales, even making repeat purchases without realising.

But Lim has changed her habits by being more “intentional” with her purchases and opting for hand-me-downs. She documents her underconsumption journey and shares tips on social media.

For Lim and many of her peers, the trend is a response to the rising cost of living, job uncertainty and lay-offs, which have forced them to reduce their personal spending. The trend resonates more with those living in Singapore and Hong Kong, given the small spaces where overconsumption could quickly become filled with clutter, said Lorna Tan, head of financial planning literacy at DBS Bank.

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For civil servant Marsha Ho, 30, taking on a “low buy” challenge earlier this year has been a way to alleviate her feelings of guilt over waste and what she describes as “mindless” spending.

However, if underconsumption were to become mainstream, it could have serious implications for the economy, said Samer Elhajjar, a senior lecturer at Nanyang Business School’s marketing department at the Nanyang Technological University.

“Widespread underconsumption can slow economic growth as consumer spending is a significant driver of economic activity. If too many people cut back on spending, businesses might struggle, leading to job losses and further economic challenges.”

Staff writers

• Why are the people in this article choosing to avoid overconsumption? Is underconsumption the solution?

• What do you think of the underconsumption trend? What effects could it have on life and the economy?