Is Job Sharing Band-Aid?
By Jane Han
Staff Reporter
If pay and bonus freezes, fewer hours and job sharing are going to help avoid layoffs and preserve jobs for the sputtering domestic economy, rank-and-file banker Kim Jae-hyun says he's all for the change. That is, only if they are temporary.
``The economy isn't going to be bad forever,'' said the 34 year-old, who works for one of the country's top lenders, ``but my concern is that employee sacrifice is going to be expected for much longer under the excuse of the recession.''
With the South Korean economy shrinking the most in a decade last quarter and the number of jobless snowballing to 3 million, an increasing number of companies has turned to alternative measures to keep people working while staying afloat.
Of the few options, job sharing has emerged as one of the most popular and aggressively encouraged.
Its basic mechanism is for two or more people to share one full-time job through reduced hours and lower wages.
According to the Korea Chamber of Commerce & Industry, the nation's largest business lobby group, one in two top 500 private corporations opted for job sharing to retain its workforce. In the public sector, job sharing is already the trend.
The Ministry of Strategy and Finance said last Thursday that major state-run firms and institutions will slash salaries for entrance-level employees by up to 20 to 30 percent this year. The Korea Electric Power Corp., Korea National Housing Corporation, Bank of Korea and the Financial Supervisory Service are among the slew of participants.
Ministry officials said the cuts would remain until workers get promoted to executive positions but did not specify when the starting pay reductions will be lifted altogether.
Companies that have implemented similar plans have also largely failed to provide a timetable, raising the level of anxiety among job seekers and workers who don't want to sacrifice their paychecks forever.
``It's fortunate to land a job in this kind of economy, but also unfortunate to enter when starting wages are expected to decrease,'' said a 25-year-old job seeker who asked to be referred to as Lee.
She said pursuing a higher degree overseas is increasingly her top option because she wants to avoid taking her first career step during a downswing.
``In two or three years, won't wages return to normal levels?'' Lee wondered.
Employers ― many of them attempting the work sharing program for the first time ― seem uncertain as well.
``Frankly, we don't know when compensation will normalize,'' said Kim Hae-ri, spokeswoman of KEPCO, the only electric utility provider in South Korea. The average monthly salary of newcomers in the public sectors is 2.93 million won as of the end of last year, according to industry data.
She said decision-makers would have to see how management conditions pan out to offer a roadmap.
Cho Seong-jae, a senior researcher at the Korea Labor Institute, however, advises that employers provide an update to workers to prevent labor strife and encourage loyalty.
``Companies need to offer a contingency plan, a scenario and promise,'' said the labor expert, stressing that transparency is needed more than ever when it comes to money.
He also added that there is currently too much emphasis on wage cuts and not enough on shortened hours.
``Employers can't expect to work their staff the same as before if they're paying them only a fraction of the salary,'' said Cho, explaining that the job sharing scheme could open up an opportunity for Korea to shed its overworked culture.
According to the OECD last year, Koreans work the longest hours ― an average of 2,261 hours in 2007 ― the highest among 22 member countries surveyed.