<이미지를 클릭하시면 크게 보실 수 있습니다>

Rumors are circulating that Japanese apparel retailer Uniqlo is considering placing its South Korean workers on paid leave to cope with plummeting sales from Korean consumers’ boycott of Japanese goods sparked by the recent trade spat.

According to sources from the retail industry on Monday, Uniqlo is reviewing a plan to offer paid leave to the entire 5,403 staff at FRL Korea, its local operator, as sales have plunged 70 percent last month as a result of the boycott.

The company is mulling various options but because it has already been shaken by bad press, the general opinion is for paid leave rather than unpaid leave, a source said.

However, Uniqlo denied the report, saying paid leave was not under consideration.

A wave of anti-Japan fervor began to sweep Korea in early July when Tokyo hit Korea’s key exports by curbing shipments of materials crucial for producing the country’s mainstay export items semiconductors and display panels.

The dispute stemmed from Korean court rulings on wartime reparation claims during Japan’s occupation of Korea from 1910 to 1945, a source of bitter resentment for many Koreans to this day.

A notice at a Uniqlo store in Nowon, Seoul, says the shop will shutter operations on Sep. 15, 2019.

Koreans vented their anger by launching a widespread boycott of all things Japanese. They refrained from traveling to Japan, Koreans’ once favorite destination, proudly posting pictures of their canceled tickets on social media.

Sales of Japanese clothes, beer and cars in Korea fell sharply as a result. Major local carriers also curtailed their flights to Japan due to a dip in demand.

Uniqlo particularly came under fire when the chief financial officer of Uniqlo’s parent company Fast Retailing said in an earnings press call that the boycott in Korea would “not last long.”

Uniqlo had been the leading fast-fashion name in Korea prior to the boycott. FRL Korea sales jumped from 895.4 billion won ($739.9 million) in 2014 to hit the 1 trillion won mark a year later. It continued its growth streak, with sales reaching 1.18 trillion won in 2016, 1.24 trillion won in 2017, and 1.37 trillion won in 2018.

FRL Korea’s operating profit in the second quarter dropped 7.3 percent on year to 53 billion won while sales gained 5.1 percent to 336 billion won.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]