Korean stock surge highlights worries over stagnant wages

Even on volatile trading days, South Korea’s stock market continues to attract enthusiastic investors. Unlike foreign investors, who sell large volumes of shares when the KOSPI falls, individual investors, often called “ants,” buy at lower prices to support the market. Recently, company restrooms have been especially crowded around 9 a.m. Many office workers reportedly lock themselves in stalls immediately after the market opens, using their smartphones to monitor stock prices. Some employees said, “There are no empty stalls at 9 a.m., so you need to go earlier.”

A growing stock market benefits not only individual investors but also the broader Korean economy. For a long time, domestic stock performance has been a sensitive issue for financial authorities. Officials felt responsible for the market’s sluggish growth, which did not match the country’s economic size, and often hesitated when discussing policy measures. Companies reported profits, but the market remained in a stagnant range known as “Box KOSPI,” prompting authorities to offer various support measures, similar to encouraging a child struggling in a wealthy household. Despite these efforts, changing market sentiment proved difficult. The current performance is therefore both encouraging and welcome.

Individual investors, especially those new to the workforce, find stock trading entertaining. Many use stock investments to cope with the fear of missing out, or FOMO, caused by soaring real estate prices.

However, it is concerning to consider the mindset of employees who temporarily abandon morning work duties to check stock prices in restrooms. Some may feel that “there are no opportunities to earn money except through the stock market.”

This perspective is understandable in the current environment. Prices continue to rise while wages lag. Although salaries are increasing, they are not keeping pace with inflation. A decade ago, the consumer price index rose 0.7 percent, but this year it has exceeded 2 percent nearly every month. Meanwhile, the National Data Office reports that the average monthly wage as of Nov. 4 increased 2.7 percent from a year earlier, slower than the 3.1 percent rise a decade ago.

Because wages have not kept pace with inflation, the value of work is increasingly overlooked. A 40-something team leader at a company recently said, “I feel like a fool for spending my mornings thinking only about work instead of checking stocks.” Among the MZ generation, the sentiment that “being a building owner is better than being an executive” has gained traction.

If the belief that “investing is more worthwhile than working” becomes widespread, it could harm employees’ mental health and, ultimately, corporate productivity.

For salaries to feel as rewarding as stock gains, more growth-oriented companies are needed. The momentum in the semiconductor industry should gradually extend to other sectors. Rapid wage increases are challenging given domestic and global conditions.

Given these circumstances, companies must focus on both growth and continuous adjustments to wage systems. Compensation should reflect the value of each job and individual performance.

The government should also recognize that taxes on capital income are lower than those on earned income. While sweeping reforms may be difficult, particularly amid strong opposition to dividend taxation during the investment boom, the long-term imbalance between capital gains and wages needs to be addressed.