Workers Demand Bigger Voice In a Remade Korean Economy

Thousands protested job cuts yesterday as unions test their clout.

"Unemployment is tantamount to death!" cried Koh Young Joo, one of tens of thousands of workers gathered at a Seoul park yesterday.

Even Mr. Koh, the secretary general of the Korean Confederation of Trade Unions (KCTU), might agree his statement is extreme. Most Koreans still regard labor unions as radical. But that could change, as protests against economic restructuring and unemployment increase.

Since the Asian financial crisis broke last year, unemployment has jumped to around 7 percent in South Korea, according to the government. Workers in the West are accustomed to such unemployment levels, but it's unprecedented here. Koreans are used to relying on their employers to provide everything from home loans to college tuition assistance.

Many are protesting in sheer fear of losing their jobs. As South Korea moves from a system of paternalistic conglomerates to an as-yet-unestablished public welfare system, the growing pains could become convulsive. Strikes in the following weeks will test the government's will to reform and its level of public support.

Against a backdrop of tall buildings and jagged mountains, demonstrators waved giant colorful banners, sang songs, and shook fists. Unions from around the country and industries ranging from banking to metalworking and telecommunications cheered as speakers barked slogans. These attempts to pressure government and employers also allow workers to express their anger and console one another.

Meanwhile, economic restructuring grinds on. An economy that boomed for decades will shrink 8 percent this year. In recent weeks, the government has directed five banks to be taken over and five public companies to be privatized. Heavy industries, like autos, are planning large layoffs. A commission of labor, management, and government officials was arranged in February to ease the transitions.

But "the government is asking only labor to bear the burden," says Mr. Koh, hands on his hips, sporting a headband that reads "Unified Struggle!" "We oppose the forceful, unilateral restructuring by the government," he says.

In addition to restructuring, unions want employment guarantees and probes into unfair firing practices. They also want the government to renegotiate the terms of Korea's International Monetary Fund bailout package and dismantle the three-party commission.

While the protest was peaceful, riot police lined the streets in case rambunctious student groups joined the demonstrations. One policeman, who asked not to be named, said many of his friends are unemployed. Most of the police sympathize with the protesters, he says.

Unions demand an end to layoffs, or at least job sharing. But it's an ultimately impractical demand. Heavy industry will yield to service-sector activities like finance and information technology as the economy goes through a seismic shift.

But the issue isn't "whether it be manufacturing or services," says Koh. Unions want to end the dominance of chaebols - South Korea's powerful conglomerates - and empower small businesses while giving unions more say in company matters.

Labor unions can't reverse the trend of restructuring. The economy is simply too noncompetitive. A study by McKinsey Inc., an American consulting firm, showed that Korean companies produce little more than half as many goods and services as their American counterparts with the same inputs of capital and labor.

Given the daily urgings from the president, businesses, and the media about economic restructuring, the unions can't expect much public sympathy. The government has asked management taking over new companies to retain as many low-level employees as possible, but new managers generally say they'll do as they please.

As a result, unions will certainly call more strikes. By July 15, 150,000 workers will be on strike, says the KCTU, and rallies will be more frequent.

The government has increased this year's budget to help accommodate the jobless and small and export-oriented businesses.

But Kwon Chung Sam has little hope. One of the thousands in Sunday's crowd, Mr. Kwon has no plans if he loses his job. "The people without money always lose," he says.

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