Shipbuilding regions see slower wage growth

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Shipbuilding regions see slower wage growth

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The ongoing restructuring of Korea’s shipbuilding industry continues to takes its toll on the southern port city of Ulsan, where much of the industry is centered.

Even though Ulsan’s workers earned the most among the country’s 16 major cities and provinces, the latest government data showed wage growth was slowest there due to conditions caused by restructuring.

According to Ministry of Employment and Labor figures released Monday, a worker in Ulsan earned 4.29 million won ($3,834) per month on average as of April, which is 125.5 percent, or 8730,000 won, higher than the nationwide average of 3.42 million won.

But the figure only rose 1.4 percent year on year. The government cited less work available in the region as a contributor to the low growth.

“Ulsan’s average wage is higher compared to other places since the nation’s major manufacturing industries such as ships and automobiles are concentrated there, as well as many finance and insurance-related businesses, which tend to give higher wages,” said Yang Hyun-soo, a director at the ministry.

“However, Ulsan’s wage growth rate in April was the lowest as the amount of jobs available dropped compared to the previous year.”

The average number of working hours in Ulsan fell 7.7 percent, or 15 hours a month on average, to 180.1 hours. This is still 3.4 hours longer than the nationwide average, but it was the sharpest drop among the country’s major cities and provinces.

The average number of working hours in the province of South Gyeongsang, where shipbuilding is also a prominent industry, dropped 5 percent, or 9.7 hours, to 184.4 hours.

The government added that overall working hours across the nation dropped in April compared to the previous year, as there were two fewer business days this year.

More than 26 percent of workers in Ulsan were working in the manufacturing sector, the highest percentage in the country, and recent government data suggests that ongoing restructuring is negatively affecting the region’s labor market.

Other data released by Statistics Korea earlier this month said the number of unemployed in Ulsan rose by 8,000 last month. The overall unemployment rate rose 1.2 percentage points compared to the previous year to 4 percent, and it was the fourth highest in the nation after key regions in the country including Incheon (4.4 percent) and Seoul (4.3 percent).

South Gyeongsang’s unemployment rate rose 1.6 percentage points from a year ago to 3.7 percent as well.

These areas are at the heart of the nation’s shipping and shipbuilding industries, and during their heyday, the regions enjoyed the highest employment and average wages in the country.

After Ulsan, Seoul saw the second-highest average wages at 3.83 million won, while the southern island of Jeju marked the lowest with 2.56 million won. The government said the island’s wages were lower than in other regions of the country because the vacation spot’s dominant industry, the service sector, tends to have lower wages.

Wages rose the most in the province of North Chungcheong, jumping 5.4 percent from the previous year to 3.18 million won, followed by Gangwon, where wages grew 4.8 percent to 3.02 million won.

North Chungcheong was also the place where people worked the longest hours, an average of 185.6 hours a month, followed by South Gyeongsang with 184.4 hours. Seoulites, on the other hand, worked the shortest hours, just 168 hours a month.

“People in North Chungcheong and South Gyeongsang worked longer hours because there were more workers in the manufacturing industry, while the working hours were shortest in Seoul since there were more white-collar jobs such in finance and insurance-related sectors,” said Yang at the Labor Ministry.

Koreans’ working hours dropped 6 percent, or 11.2 hours, to 176.7 hours a month in April compared to the previous year, while their average wages per month rose 3.4 percent to 3.42 million won.


BY KIM YOUNG-NAM [kim.youngnam@joongang.co.kr]

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