Average annual salaries at major South Korean conglomerates surpassed 100 million won for the first time, but the pay gap between rank-and-file employees and top executives widened further compared to the previous year.
Leaders Index, a corporate analysis research institute, analyzed 211 comparable companies among the top 500 firms by revenue and found that the average actual annual salary for employees reached 102.8 million won ($75,000) last year, up 5.2% from the previous year, according to data released Sunday.
The average compensation for the highest-paid executive at those companies, however, rose 7.6% to 2.18 billion won over the same period. As a result, the pay gap between top earners and average employees widened from 20.7 times to 21.2 times. The faster pace of executive pay increases compared to employee salary growth was identified as the main driver.
◇ Retail, Food & Beverage Show 'Extreme Gap'... Financial Sector Relatively Moderate
The gap varied sharply by industry. The retail sector showed the largest disparity. The highest-paid executive in retail received an average of 2.54 billion won, up 20.1% from the previous year, while the average employee salary stood at just 64.47 million won — a 39.3-fold difference.
The food and beverage sector followed at 34.2 times, holding companies at 29.3 times, and IT and electronics at 28.5 times. In contrast, the banking sector saw the gap narrow to 8.3 times as employee salaries (111.28 million won) rose faster than executive pay. The broader financial sector, including insurance (11.1 times) and credit finance (11.2 times), maintained relatively lower gaps compared to other industries.
◇ HS Hyosung Posts 120-Fold Gap… Hanwha Chairman Tops Individual Pay
Among individual companies, HS Hyosung showed the widest gap. Vice Chairman Cho Hyun-sang received 7.35 billion won while the average employee salary was just 61 million won, resulting in a 120.5-fold difference. At affiliate Hyosung, Chairman Cho Hyun-joon received 10.199 billion won — 118.2 times the average employee salary of 86.3 million won. Including compensation from affiliates, his total pay reached 15.735 billion won.
At E-Mart, Shinsegae Group Chairman Chung Yong-jin received 5.85 billion won, producing a 114.6-fold gap with the average employee salary of 51.03 million won.
In terms of total individual compensation, Hanwha Group Chairman Seung-youn Kim topped the list at 24.841 billion won ($18.1 million). CJ Group Chairman Lee Jae-hyun (17.743 billion won) and Hyundai Motor Group Executive Chairman Euisun Chung (17.461 billion won) followed.
◇ Securities and Semiconductors Dominate Top Employee Pay Rankings
The financial, securities and semiconductor sectors offered the highest employee salaries. Korea Investment & Securities ranked first at 181.74 million won, followed by SK hynix (000660.KS) at 180.76 million won, NH Investment & Securities (005940.KS) at 178.51 million won, and KB Financial Group (105560.KS) at 173.98 million won.
"While employee compensation increased due to improved corporate earnings at large companies, the pay gap widened as executive pay rose at an even faster rate," a Leaders Index official said.