Imperfect unions

Kim Kwang-ki
The author is an editorial writer of the JoongAng Ilbo.

“Workers of all lands, unite!” “Let’s do our part for society!” These are some slogans that appear on banners at recent rallies by the Korean Confederation of Trade Unions (KCTU). The contentious trade union must be feeling a cold vibe from the public. But it is still barking up the wrong tree to find a solution.

Companies are growing tired of hard-line unions in Korea. Many are taking new businesses overseas along with jobs that otherwise would have gone to Koreans. In today’s globalized world, there are no frontiers in investments and consumption. Governments must vie rigorously to draw foreign capital to their home turfs and make jobs for their economies.

Members of the KCTU are not oblivious to the recent trend. But they still look for solutions in old-fashioned ideological books. “Workers of the world, unite!” is a famous rallying cry from Karl Marx’s 1848 “Communist Manifesto.” Imagine what the world would look like if workers from all lands united and if wage and working terms became the same across the world. Capital would no longer chase cheap labor cost and wealth disparities could ease significantly.

But that can only work in theory. Post-Marx, workers have endured two world wars and fought for their national interests. Today’s workers also team up with their governments or employers to fight for work with other countries. In both developed and emerging economies, governments, workers and employers are joining forces for their collective interests. Korea is the odd man out.

What about the second slogan, “Let’s do our part for society!” Unions are enjoying a late heyday under the liberal government of President Moon Jae-in. Memberships of the two umbrella groups increased by 10 percent last year. The Korean Federation of Trade Unions (KFTU) represents 1 million workers and the more combative KCTU represents over 900,000. Of the near 2 million members combined, more than 80 percent are on the payroll of large private companies, financial companies and public companies. Unionization at companies employing 300 or more is 60 percent, whereas the share is a marginal 0.2 percent at small workplaces that employ 30 or fewer.

Most of the members of the two umbrella union groups earn 80 million won ($71,016) to 100 million won a year, among the highest earners in the country. They are referred to as upper-class unionized workers. The income gap between full-time workers aligned to the two union groups and those of smaller companies or part-timers is ever-widening. That may explain the unlikely new slogan at KCTU rallies, meant to appease negative sentiment towards the unionized workers. The two umbrella unions are now attempting to take advantage of their powerful organizations to represent the weak individuals.

But a slogan is just a slogan. In reality, unionized workers demand that companies first give them work. They oppose the so-called Gwangju business model, where the Gwangju city government and Hyundai Motor want to start an auto-making factory to assemble cars at cheaper labor costs to create jobs and save cost for the manufacturer. That’s the last thing they want to see.

President Moon has shown a new eagerness to turn more of his attention to the economy and unfavorable business realities. He vowed to improvement the economy and individual livelihoods, and is verbally promoting corporate innovation and investment. He has started meeting owners of small- and mid-sized, as well as big, companies. Lifting regulations and increasing fiscal spending won’t be enough: the labor market must be revamped. Companies won’t be encouraged to innovate and invest when authorities are under the influence of powerful unions.

The government must shake off its indebtedness to the KCTU, although the group did help the administrations take power. The administration must pay attention to the broader population and create an environment to generate more jobs. When entrepreneurship and financial markets revive, innovative growth will pan out even without heavy government spending.

A grass-roots revolution to replace the corrupt former administration was possible through the joining of the broader working and centrist populations. It is true that unions and progressive civic groups laid the groundwork. But without the participation of housewives and families in the weekend protests, the peaceful candlelight vigils to remove a corrupt president for the first time ever could not have been possible. Moon cannot make headway in his reform agenda if he cannot win support from the business and middle-class communities.

JoongAng Ilbo, Jan. 9, Page 27