The objective of this study is to shed new light on the development of labor-management relations at small- and medium-sized machine manufacturing businesses, against the backdrop of Korea’s economic growth during the 1960s and the 1970s.
South Korea was able to achieve a remarkable economic growth throughout the 1960s by maintaining a good balance of both the domestic market and exports. Peaking in 1977 with an annual growth rate of 17.4 percent, Korea’s exports began to decline, to 14.3 percent in 1978 and to -3.2 percent in 1979. Economic growth and fluctuations became the daily concerns of ordinary Koreans.
We must not assume that this sudden decline in the growth rate of Korea’s exports stems solely from the recession of the overseas markets and the reduction of trade with foreign clients. There are also important major factors fuelling the downturn. One such factor is the poor state of labor-management relations in small- and medium-scale machine manufacturing in Korea.
In general, small and medium businesses offer working environments that differ significantly from those of large corporations. Yet a significant number of Korean people continue to work at these smaller businesses thanks to certain advantages that only those businesses can offer. These businesses, however, find it nearly impossible to grow into large corporations and struggle with the shortages of capital and technological resources. While both labor and management try to mitigate these difficulties by improving their relations and clarifying their respective roles and responsibilities, the Korean manufacturing sector is still skewed in favor of management. Acknowledging the need to change this situation, the Korean legislature amended relevant laws in 1973 and 1980.
To improve labor-management relations, small- and medium-sized businesses need to make active efforts to improve the working and living conditions of their employees, such as making public bath facilities available, or providing dormitories. These businesses need to invest into improving the standard of living for their employees, but only in necessary areas, to avoid waste.
These businesses may need to establish strict rules on labor-management rules, develop channels for settling disputes, and recognize that labor-management relations matter even when financial interests are not directly at stake.
노사관계사례연구(A case study on labor-management relations: small and medium machine manufacturing businesses)
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Industry and Technology < Entrepreneurship
Social Development < Employment
|Holding||KDI; KDI School|