South Korea faces a growing number of strikes by workers who are dissatisfied with their wages and concerned about job security.
(Bloomberg) — South Korea faces a growing number of strikes by workers who are dissatisfied with their wages and concerned about job security.
Top automakers are among those caught in the wave, with unions at Hyundai Motor Co. and Kia Corp. planning to down tools as they push for increases in minimum pay and the mandatory retirement age. Both companies posted record profits in 2022 and workers are angling for a bigger slice.
Steelmaker Posco also faces a strike over wages, and the railway workers’ union plans a boycott next week that would cause widespread disruptions.
“Workers are struggling with inflation, especially higher energy costs, but the government is trimming fiscal spending,” said Kim Dae-jong, a business administration professor at Sejong University in Seoul.
President Yoon Suk Yeol has taken a sterner approach to unions than predecessor Moon Jae-in, making labor reforms a priority after taking office in May last year. In December, he got truck drivers to return to work after a two-week strike, resulting in a jump in his approval ratings.
Still, the number of strikes at Korean companies with more than 300 employees stood at 64 in 2022, the most since 2019, according to Park Sung-Bok, an economist at Pi-Touch Institute in Seoul.
Strikes at Hyundai and Kia, which have about 70,000 union members in total, could impact other industries given their size and ties with the Metal Workers’ Union, the most influential group for unionized workers in the country.
Kia workers are voting from 11 a.m. to 8:20 p.m. Friday on whether to strike. Hyundai, which has South Korea’s biggest union by members, faces the threat of four-hour partial strikes for two days next week if demands aren’t met.
Employees at both automakers are calling for a 184,900 won ($140) raise in monthly base pay, bonuses and a shift in the retirement age to 64 from 60.
According to a Hyundai union representative, the average annual pay for Hyundai and Kia factory workers is 90 million won. That’s about the same as the median pay for an economist at South Korea’s central bank.
The unions also want more investment in plants and facilities to produce electric vehicles in South Korea to help safeguard jobs. Kia and Hyundai, which plans to sell 2 million EVs annually by end of this decade, are facing pressure in the US and Europe to increase production in those regions.
“If Hyundai and Kia raise the retirement age, other industries will follow,” said Kim Pil-Soo, an automotive engineering professor at Daelim University College in Anyang City. “Their workers are already very old as Hyundai and Kia don’t fire people as much as other industries do,” he said, adding that the companies should rely more on automation and younger workers in their factories.
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