“Irregular
workers” shake society
Before the financial crisis of 1997-98 in East
Asia, there was no word in the Korean language for “irregular worker” – workers
with no guarantees of job security or promotion, working on short-term
contracts.
Permanent jobs were the norm until the tumult
of the late 1990s (invariably referred to as “the IMF crisis” by South Koreans)
set in motion changes in the nature of employment that are now jeopardizing the
country’s middle class and social cohesion.
Prior to the crisis, South Korean workers were
organized in militant trade unions. Under the Trade Union Law, only one union
was allowed per workplace and laying off workers was almost impossible. In the
crisis’s wake, a tripartite agreement was reached between the IMF, trade unions
and debt-ridden businesses to amend labor laws to make hiring and firing more
responsive to changes in the market. The chaebol, Korea’s giant conglomerates,
adopted “worker flexibility” as a mantra.
Now the employment situation, particularly
among the young, may be at the root of the political changes shaking South
Korea. Recently dubbed the 2030 Generation in accordance with the South Korean
tendency to give political movements quirky names made up of numbers, voters
aged in their 20s and 30s recently turned Seoul politics on its head by
rejecting the two main parties and electing Park Won-soon, a progressive
independent, as mayor of Seoul, one of South Korea’s most powerful political
positions.
Many voters voiced dissatisfaction with the
country’s traditional forms of leadership and an interest in a new style of
public leadership. President Lee Myung-bak, once the chief executive officer of
Hyundai Engineering & Construction, is regarded as a close friend of the
chaebol. Another independent, software tycoon Ahn Chul-soo, is rumored to be
planning a run for the presidency next year. The results of a poll released by
the Chosun Ilbo newspaper on September 7 found that 41.5 percent of respondents
supported Ahn, while 40.7 backed the Grand National Party’s Park Geun-hye, who
had been the frontrunner.
According to a report released on Oct. 24 by
the Korea Labor Institute, there are now 5.69 million non-regular workers in
South Korea, accounting for 33.4 percent of the country’s 17.05 million
workers. By contrast, in 2001, 17 percent of South Korea’s workers were
irregular. Figures released on October 28 by Statistics Korea show that there
the number of irregular workers has grown by 5.4 percent growth from 2010. The
rise in the number of irregular workers has been accelerating, rising at over
twice the rate of regular workers.
Since recovering from the crises of 1997-98
and 2008, South Korea has continued its impressive pace of development, growing
to become Asia’s fourth largest economy. Also growing, however, is an alarming
array of social troubles, including a uniquely high rate of suicide, the
highest in the 32-country Organization for Economic Cooperation and
Development. An average of 42 people kill themselves every day, according to
government figures. In addition, the country’s total fertility rate, at 1.28
births per woman, is among the lowest in the world. Internet addiction and
depression are also very high.
South Korean couples often can’t afford the
skyrocketing cost of educating children, which also became a campaign issue in
the Oct. 26 election. There is a strong culture of shame that leads those
unable to find decent work to withdraw from social life and become isolated.
This situation leaves some South Koreans stuck in a kind of extended
adolescence.
“In the Korean context, if you only have an
unstable job, it affects your general life condition. If they don’t have a
stable job, as many college graduates don’t, they can’t date, they can’t marry,
they can’t form a family. That can make them deeply frustrated and angry,” said
Hagen Koo, Professor of Sociology at the University of Hawaii.
Although South Korea is often praised for the
country’s quick ascension from poverty to wealth, as its international profile
grows, citizens are finding it increasingly difficult to achieve any kind of
social mobility.
South Korea’s two basic methods of social
mobility have traditionally been education and entrepreneurship. Both have got
more difficult with huge increases in the price of education and a tougher
business climate for small and medium sized enterprises.
"Although the economic environment for
the corporations and the businesses in Korea is great, the economic situation
for small business and the low middle class has been at its worst in the past
few years," Hyun Jae-ho of Korea University told Reuters in an Oct 31
report.
Many of the stable, well-paying jobs in South
Korea have in the past come from the country’s chaebol. Even though they are
earning well, the largest are hiring fewer employees than ever. A study
published in early April 2011 by the Hankyoreh newspaper showed a 73 percent
rise in conglomerate profits alongside 10 percent growth in employment and 1.3
percent growth in workers’ income under the Lee administration.
So while there is growth in South Korea, it is
making its way into few households. According to UBS Investment Research, wages
in South Korea are growing at 2 percent and are negative when adjusted for
inflation.
Rising food and energy costs are straining
household budgets. As middle class budgets are being stretched, debt in South
Korea has reached 150 percent of disposable income, as South Koreans borrow to
keep pace with the lifestyles of the better-off and pay large sums to educate
their kids.
The OECD’s Employment Outlook 2011 found that
of the 21 countries studied, South Korea’s tax transfer system did the least to
ease the burden on low-income workers whose buying power has been weakened due
to lower real wages.
“The middle class itself is becoming
internally divided between a very small, very affluent segment and the rest of
the middle class. When the rest of the middle class compare themselves with
these upper-middle class people, they naturally wonder whether they still
belong to the middle class or not,” Professor Koo of the University of Hawaii
told Asia Sentinel.
When a new government takes over South Korea’s
government next year, one of its most important tasks will be to address the
issue of employment. South Korea has fared pretty well over these past few
years of global economic turmoil. In order for that to continue, the
stabilization of South Korea’s job market will likely rank high on the next
president’s agenda.
Steven Borowiec
Asia Sentinel
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