Moon’s push to upgrade workers sparks tensions

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Moon’s push to upgrade workers sparks tensions

Tensions are rising between Korean businesses and the Moon Jae-in administration over promises that the president made during his campaign.

Businesses have argued that many companies, particularly small and medium-size operations, will face immense financial burdens to keep the Moon administration’s employment vows, including converting irregular workers to permanent employees.

However, the president has said that businesses should be more aggressive in trying to solve the Korean youth unemployment problem while taking responsibilities for their role in creating the current issue.

“The first thing the Korea Employers Federation should do is to earnestly reflect and take responsibility as one of the key players in dividing society created by irregular workers,” Moon said Friday, in an unusual move.

His comment followed the employers lobby group’s vice chairman Kim Young-bae’s remark the day before that businesses are facing hardships over the demand to convert irregular workers to regular workers.

Kim said every business operates differently depending on how they manage their workforce and seeing irregular employment simply as bad not only further fuels conflict but leads to a reduction in jobs.

The issue of temporary workers has been one of the biggest concerns in recent years, especially as the group comprises many low-income families.

Irregular workers account for 32 percent of the nation’s workforce, the government said. According to Statistics Korea, there are more than 6.1 million temporary workers.

However, the wage gap between irregular workers and permanent employees is widening. Last year, the average monthly earnings of irregular workers were equivalent to 54 percent of the wages of permanent workers. While regular employees took home slightly below 2.8 million won monthly, irregular workers took home 1.49 million won.

This is the biggest difference since related data began being compiled in 2004. The wage gap has been growing since the global financial crisis of 2008, when earnings of temporary workers were equivalent to 54.6 percent of the regular workers.

Prior to the global crisis, the earnings of irregular workers were 60 percent of regular workers.

Wage difference is not the only disadvantage temporary workers face. They’re also exposed to weaker job security and they have fewer benefits, including employer-covered insurance.

However, business groups are arguing that most of the companies that will be affected by the government’s push to convert irregular workers are small and midsize businesses.

As of August, 94.4 percent of irregular workers in the country worked at companies with fewer than 300 employees, according to a study by the Ministry of Employment and Labor.

Furthermore 72.2 percent of irregular workers work at businesses with less than 30 employees.

In fact irregular workers only accounts for 0.7 percent of all employees at the country’s largest company Samsung Electronics. There are 700 temporary workers out of a total of 94,000.

“The fundamental problem is not about regular workers and irregular workers but rather an issue between conglomerates and small and midsize businesses,” Kim at the employers’ federation said.

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