Lunch prices are rising fast, but wages aren't keeping up

Korea Herald

17-02-2025

Finding an affordable lunch is becoming increasingly difficult for office workers in South Korea. The cost of eating out has surged over the past four years, far exceeding wage growth, and pushing more employees to rely on convenience store meals or company cafeterias.
According to the Korea Consumer Agency, a bowl of kimchi-jjigae (kimchi stew), a typical go-to lunch option, cost an average of 8,269 won ($5.73) in Seoul as of December, 22.8 percent higher than in 2020. The price hike has been even steeper in cities like Daejeon, where the same dish jumped 52.3 percent over the four-year period, reaching 9,900 won ($6.87).
The price of a roll of gimbap in Seoul, considered one of the most budget-friendly choices, climbed 32.7 percent over the same period, now costing 3,500 won.
Dining out has become significantly more expensive overall. The price index for commonly eaten foods, including meals, coffee, and alcohol, rose 21.0 percent from 2021 to 2024 -- about 1.5 times higher than the general consumer inflation rate of 14.2 percent. The steepest increases occurred in 2022 and 2023 as food supply costs surged.
Wages lag behind
However, wage growth has lagged behind. South Korea's Ministry of Employment and Labor reports that the average monthly wage for employees at companies with at least one worker rose 14.9 percent between 2021 and 2024 -- barely keeping pace with overall inflation but failing to match the sharp rise in food prices.
The situation is even tougher for workers at the bottom end of the pay scale, as the minimum wage increased by only 13.1 percent in the same period, from 8,720 won per hour in 2021 to 9,860 won in 2024.
With lunch prices soaring, many office workers have turned to cheaper alternatives. A survey conducted in November by South Korean consumer research firm Embrain Trend Monitor found that 30.2 percent of workers now buy their meals at convenience stores or supermarkets, up from 22.0 percent in 2021. The use of company cafeterias has also grown, from 49.6 percent to 55.2 percent over the same period.
Sales data from major convenience store chains reflect this shift. GS25 reported that lunchbox sales in 2024 were 3.2 times higher than in previous years, while rice ball sales rose nearly threefold. CU, another leading chain, saw sales of samgak gimbap (triangle-shaped rice balls) more than double.
Despite these cost-cutting efforts, food expenses are taking up a growing share of household budgets. Statistics Korea data shows that in the first three quarters of 2024, the average urban household with two or more people spent 14.4 percent of its monthly budget -- 516,765 won -- on food. The portion spent specifically on dining out has risen from 12.4 percent in 2020 to 13.9 percent in 2022, reflecting the fact that eating out costs have climbed faster than overall inflation and income growth.
As a result, meal allowances have become a major sticking point in labor negotiations. In 2024, university cleaning workers in Seoul gained public sympathy when they demanded an increase in their daily meal allowance from 2,700 won to 3,100 won.
Their claim that '2,700 won isn't even enough for a single roll of gimbap' resonated with many South Koreans, leading to a successful labor agreement.
The issue has also caught the attention of policymakers. At the end of 2024, an opposition-led special committee on wage protection proposed raising the monthly tax-exempt meal allowance from 200,000 won to 300,000 won to help workers cope with rising food costs.
However, experts warn that only large corporations can afford to provide such benefits. Kim Jong-jin, director of the Korea Worker Institute, said, 'Low-wage workers are hit hardest by rising food prices. The government should consider tax benefits (for them) or a higher minimum wage to help them keep up.'