Survival strategy in N. Korea
North Korea is often described as the ``world’s last Stalinist state,” but this description became misleading a long time ago.
The state sector in the North Korean economy has shrunk dramatically ― maybe, to less than half of what it used to be in 1990. The subsidized rations, once by far the most important source of calories for virtually all North Koreans, are no longer delivered to a majority of the population. Instead, the average North Korean makes a living through some form of market activity.
Such activities are numerous and varied ― North Koreans trade, smuggle, provide services, manufacture consumer goods at home, and toil in semi-legal private fields. Officially, this entire booming private sector does not exist. The North Korean state does not recognize it. The authorities still demand that all adult males and unmarried females attend their official work place.
However, this demand is completely unrealistic since rations are no longer delivered (or sometimes delivered only partially), whilst the official monthly salary would buy merely one or two kilos of rice at the current market price. So people have to earn money outside the state economy, but it remains a crime to be absent from work. So what is done to get around this problem?
Women find themselves in a somewhat privileged position. Even in former times, when the hyper-Stalinist economy still functioned properly (sort of), women could choose to become full-time housewives upon marriage.
Nowadays, this privilege is used by nearly all married women leaving their official state jobs and switch to private economic activities as soon as they get a husband. Incidentally, this is the major reason why women are so overrepresented in the North Korean black market economy.
For men, it is much more difficult to evade official duty, and the price of disobedience also is quite high. Nonetheless, the situation is not hopeless: there are ways to be absent from work legally.
First of all, a male worker can obtain a medical certificate which states that he is not capable of work. One needs to have good connections or bribe a doctor to get such papers, but this is often a worthwhile investment, since medical certificates give their holder a lot of free time to run their own business.
Another option is far more common. A male worker can negotiate an agreement with his superiors and instead of showing up for work, he pays the so-called ``Aug. 3 contribution.” This term is related to the Aug. 3, 1984 decision, which allowed state-run factories to use industrial waste and low-quality materials to start household production of consumption goods. It was assumed that female workers could safely be allowed to stay at home to make paper fans or plastic pins.
When, in the 1990s, the state economy collapsed, many workers began to use the decision as a way to justify their permanent absence from the workplace. They would make a monetary contribution to their factory on the completely false assumption that they are instead producing something at home. It seems that part of the money is pocketed by the supervisor while the rest indeed goes to the factory budget.
The exact amount of such an ``Aug. 3 contribution” is negotiated, and largely depends on the absentee’s estimated future income (worker’s supervisors usually know what kind of business he is likely to start and how much money he is likely to make).
For the average semi-skilled worker, who just helps his wife to run a food stall, the amount is likely to slightly exceed his official salary (nowadays this amounts to a couple of dollars a month). For somebody who is known to have become a successful wholesale merchant, the ``Aug. 3 contribution” would be very large: I am aware of cases where persons paid ten or fifteen times their official salary for the privilege to never be seen on the factory floor.
Interestingly enough, the ``Aug. 3 contribution” also buys exemption from the official meetings, political indoctrination classes and mutual criticism sessions which take up a lot of the time of the average North Korean worker.
That said, only a minority of North Korean workers can afford to pay the ``Aug. 3 contribution” or bribe a medical doctor into issuing a fake health certificate. Most male workers still attend their non-functioning factories, but for a few hours before disappearing, not to reappear until the next morning.
This is a relatively risky option, since such people are occasionally caught and punished. But risks are low, so for somebody with low income, it seems to be the only alternative ― while the more successful, of course, are engaged in their businesses and buy security and time through the ``Aug. 3 contribution.”
Professor Andrei Lankov was born in St. Petersburg, Russia, and now teaches at Kookmin University in Seoul. He can be reached at firstname.lastname@example.org.