[EDITORIALS]Wage freeze a good ideaFive employers’ organizations suggested that large businesses should freeze wages; the money that would be generated by the freeze would be used to improve the working conditions of temporary, part-time and contract workers. But labor resists the idea, saying that regular workers of large businesses are also suffering from a drop in real wages.
A wage freeze by large businesses, even though it means a concession from regular workers, is a realistic solution considering the severe economic situation of the nation.
Domestic firms are now suffering from a drop in domestic consumption. If they raise regular workers’ wages by 10 percent and raise those of irregular workers to 85 percent of those of their regular staff, as labor insists, then the firms’ competitiveness will drop even further.
If the low wage level of irregular workers is a problem, then it must be solved without compromising competitiveness. We believe there must be concessions here. We find the argument convincing that the wages of regular workers in large businesses should remain the same. Their wage level is already high by global standards.
Labor must take into consideration the long-term position of the national economy and workers. In the United States last year, 41 percent of all labor unions endorsed wage freezes. They knew that they would lose jobs if their companies were closed because of high wages. Japan’s Toyota, which generated more than 1 trillion yen ($8.8 billion) in net profit last year, and Posco, a Korean firm that recorded the highest profit in its history last year, both decided to freeze wages. That is because they are concerned about their competitiveness.
Management and the government should cooperate as well. The fact that Korea has the highest percentage of irregular workers in its work force among the 30 OECD countries should be redressed. Management will have to make a promise that they will share profits with employees if they achieve a certain level of profits. The government may consider tax benefits for businesses to solve the irregular worker issue. Labor, management and the government have to work together. But we believe this time, labor unions of large companies should accept a wage freeze.