The objective of this study is to present arguments for the establishment of wage policy suitable for the conditions of Korean industrial society.
In production society, wage is the source of income to an employee and expense to an employer. A rapid increase in wage burdens the entrepreneur in short term, and provides an opportunity for labor-saving in the long term. The validity of this productivity-wage system withstands criticism at the conceptual level, however it is difficult to measure labor productivity, or which industry or what kind of occupation level applies. It is difficult to estimate labor productivity for each company. Also it is almost impossible to measure labor productivity of tertiary industry. Therefore, the application of wage patterns based on labor productivity of manufacturing industry to every industry is not appropriate.
This study did not find that cost-push inflation of Korea was initiated by labor unions of mainly production workers. On the contrary, during the period of economic overheating from 1976 to 1977, the labor market moved from oversupply to partial undersupply. At this time, recruitment of university graduates among “white collar” companies increased, and wage floatation caused cost-push inflation.
This kind of wage floatation phenomena has occurred in large companies. Since these large companies not only have large market shares, but also receive benefits including loans from the government, they have been exposing their poor management by shifting wage increase expenses to prices, or relying on loans while operating at a deficit. As long as there remains an element of cost-push inflation, government intervention is inevitable regardless of income policy.
Wage guidelines implemented by the government in 1981 and 1982 were found to have drawbacks in methodological effectiveness. We propose income equalization policy in order to rectify these problems and establish proper wage policy. For income equalization policy to become popularly accepted, we have to convince the Korean population that everyone is tightening his or her belt, whether they are farmers or urbanites, employers or employees, or production workers or office workers.
To this end, income equalization policy should limit the wages of high income earners and should not oppress or exclude low income earners of production work. Secondly, no matter how precise income equalization policy may be, it should be equipped with economy control functions to succeed.
한국노사관계의 특징과 소득평준화정책(Characteristics of Korea’s labor-management relations and income equalization policy)
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Economy < Macroeconomics
Social Development < Employment
|Holding||KDI; KDI School|