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Service sector price hikes outpace overall consumer inflation rate

Published: 26 Apr. 2026, 19:16 Updated: 27 Apr. 2026, 15:35

A dry cleaning machine is operated in a laundry shop in Seoul on April 19, 2023. [NEWS1]

Laundry bills, haircuts and other everyday service costs are rising faster than headline inflation in Korea as higher oil and materials prices linked to the Middle East war spread through the broader economy.

The squeeze is showing up in household budgets and small business costs alike. Personal-service prices rose 3.2 percent in the first quarter from a year earlier, outpacing the overall consumer inflation rate of 2.1 percent, according to Statistics Korea on Sunday.

Consumer prices in March rose by 2.2 percent on year, underscoring the broader inflation pressure.

An office worker surnamed Park was recently stunned after taking winter clothes to a neighborhood dry cleaner. Cleaning four items — a padded jacket, coat and pants — cost more than 90,000 won ($61).

“When I told the owner the price had jumped too much, the owner apologized and said there was no choice because dry-cleaning solvents and fuel costs had gone up,” Park said.

“I had planned to send in a few more clothes while organizing my closet, but now I don't dare think about it.”

A hair salon owner in Incheon surnamed Yoo raised haircut prices by 12 percent last month.

“I have a lot of long-time customers, so I tried as hard as I could to hold prices steady, but after the Middle East war broke out, material costs rose by about 10 percent and it became too hard to hold on,” Yoo said.

“I’m also preparing to move the salon, and even interior costs have shot up, so I’m very worried.”

In fact, 105 of 116 personal service items were more expensive in the first quarter than a year earlier, according to data from the Korean Statistical Information Service.

Products from Emart’s ultra-low-priced “5K Price" line is displayed at a Emart. [EMART]

All 39 dining-out items increased in price, with gimbap (seaweed rice rolls) up 4.2 percent, jajangmyeon (black bean noodles) up 4.8 percent and dosirak (boxed meals) up 5.7 percent.

Outside dining, nearly every item also rose except for seven categories, including job-training academy fees, down 0.7 percent and reading-room fees, down 0.2 percent. Appliance repair fees climbed 14.3 percent and computer repair fees rose 10.4 percent on higher labor and parts costs. The four categories that held steady, such as financial service charges and vehicle inspection fees, were items that had already gone long periods without price changes.

Among service prices, especially sharp increases were seen in day-to-day necessities such as laundry fees, up 7.1 percent, haircut charges, up 3 percent, bathhouse fees, up 2.9 percent, and beauty service fees, up 2.3 percent.

Laundry businesses have been hit particularly hard. Laundrygo, an online laundry platform, raised the price of washing dress shirts by 20.8 percent on Thursday to 2,900 won from 2,400 won. The company said unstable international oil prices since the Middle East war had pushed up the cost of packaging vinyl, consumables, hangers, fixing materials, dry-cleaning solvents and fuel by about 16.7 percent to 80 percent depending on the category. Cleantopia has also raised prices for key items by 5 percent to 12 percent this year.

Parents are also feeling the pressure as college application fees rose 9 percent, online education fees 7.2 percent, postpartum care center fees 5.2 percent and school dormitory fees 3.9 percent.

“I had frozen academy fees since the Covid-19 period, but labor and all sorts of other costs kept rising, so this year I had no choice but to raise tuition,” said a math academy operator surnamed Choi, who raised tuition by about 10 percent in March.

The government said it would pursue institutional changes to ease the burden of service inflation. Laundry fees in particular will be put under a daily monitoring system to track price trends during a special ministerial task force meeting on livelihood prices on Wednesday.

“The effect of higher raw material and oil prices that had built up even before the Middle East war is now starting to spill over into personal services, and this trend could continue into the second half,” Kim Sang-bong, a professor of economics at Hansung University, said. “If extra budget spending simply pumps money into the economy, consumption could rise in the short term, but in the end it could fuel prices again, so more fundamental measures need to be considered.”

"Service prices tend to be sticky downward once they rise, and that higher energy prices could add further upward pressure as they feed into everyday living costs," Lee Yoon-soo, a professor at Seoul National University’s Graduate School of International Studies, said. “Rather than trying to suppress the price of specific items, structural measures should also be explored, including distribution and supply systems and platform fees."

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM KYUNG-HEE [[email protected]]