South Korea is seeing a sharp rise in restaurants where owners work alone without any employees or even part-timers amid the weak economy, data showed.

According to Statistics Korea on Tuesday, the so-called one-person restaurants, where the business is run solely by the owner or with unpaid family help, now make up more than half of all restaurants in the country.

In 2017, there were 485,737 restaurants nationwide, which increased to 562,051 in 2020. The figure then decreased to 551,657 in 2023.

Based on an analysis by Maeil Business Newspaper using data from Statistics Korea and the Ministry of Employment and Labor, one-person restaurants surged from 224,907 in 2017 to 343,037 in 2020, and reached 295,998 by 2023, a 30 percent increase over six years.

The decline in consumer spending is one reason for the drop in revenue, and also the steep rise in the minimum wage.

Over the five-year term led by former President Moon Jae-in, the minimum wage rose 41.6 percent and under former Yoon Suk Yeol administration, it increased another 9.5 percent, surpassing 10,000 won ($6.99) for the first time in 2024.

This year, the minimum hourly wage reached 10,030 won.

Many small business owners say they cannot afford to hire workers or even shut down due to outstanding bank loans, forcing them to operate alone.

“You can’t hire anyone by offering just the minimum wage – in reality you have to pay at least 2,000 to 3,000 won more per hour to find workers,” said a representative from the Korea Federation of Micro Enterprise.

Business lobby groups have voiced concern that continued wage hikes could worsen the situation.

A survey of 159 member companies conducted by the Korea Chamber of Commerce and Industry found that 47.2 percent identified the minimum wage increase as their top labor market concern, followed by legal risks related to major workplace accidents.

“For every 1 percent rise in the minimum wage, the closures of businesses with fewer than five employees increase by 0.77 percent,” said Ra Jeong-ju, a researcher at a think tank Pi-Touch.

“Minimum wage hikes could further strain SMEs and the self-employed.”

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