AI era forces Korea’s labor, capital to negotiate new ‘survival pact’

As artificial intelligence (AI) spreads from coding assistants to factory robots and hiring tools, experts say Korea’s familiar labor disputes over wages and bonuses are giving way to a more existential question: How labor and capital will share the costs and gains of this once-in-a-generation technological shift.

The answer, according to experts interviewed by The Korea Times, is that Korea is not ready. AI has not triggered mass layoffs, but it is quietly sealing off entry-level opportunities, deepening inequality and exposing gaps in the country's legal and training systems. Without a credible safety net and a convincing transition plan, experts warn, blunt protectionism — already visible across many sectors — becomes the rational response to automation for most workers.

“AI has become a survival question for both labor and capital,” said Ahn Jong-ki, a professor at the Korea University Institute for Research on Labor and Employment, noting the nation’s world-leading robot density and recent trials of physical AI on production lines.

Korea already ranks among the most automated manufacturing economies, and companies such as Hyundai Motor are piloting humanoid robots like Atlas alongside existing industrial robots. When Hyundai unveiled Atlas at the CES trade show in Las Vegas earlier this year, the union issued a statement vowing that “not a single robot” would enter plants without its agreement — a sign of how directly workers now perceive these systems as a threat, he said.

“Because AI and robots can touch not only simple tasks but also mid-skill work, unions feel this as an immediate, existential risk,” he said. “If management chiefly focuses on maximum efficiency and rapid substitution, and unions respond only by defending every existing job, the result will be escalating conflict that our current legal framework cannot resolve.”

Ahn stressed that the burden of adjustment does not fall on employers alone. If employees continue to insist every existing job should be frozen in place, they, too, risk losing influence as industries around the world reorganize around AI.

In his view, that “survival pact” must go beyond wages to decide who gets retrained, who is protected and who bears the risks in the AI transition. He argued that Korea now needs new rules on how companies introduce AI, how workers are reskilled and how productivity gains are shared, or today’s quiet adjustments will harden into a new divide between insiders and those shut out of the labor market.

“Both labor and management need to move beyond the principles and red lines they have traditionally defended and make it their central agenda to design new strategies for survival and coexistence in this era of change,” Ahn said. “That is no longer a matter of choice but a necessity.”

Bottom of ladder

The disruption is already showing up most clearly among young and entry-level workers, said No Se-ri, a senior researcher at the state-funded Korea Labor Institute.

“What we are seeing instead is a slow tightening of entry points,” she said, with hiring for young workers stagnating in AI-exposed sectors even as overall head counts hold steady.

The Bank of Korea has reached similar conclusions. In an analysis released last month, the central bank found that almost all of the 211,000 jobs quietly lost among people aged 15 to 29 over the past three years were in industries with high AI exposure, such as programming, publishing and professional services. The report stopped short of blaming AI alone, pointing also to weak demand and other factors, but warned that AI makes it easier for employers to automate the routine tasks that used to justify entry-level roles.

Under Korea’s uniquely strong, protective labor law, AI-driven polarization can also deepen. Workers already in secure positions who can incorporate AI tools may see their productivity improve, while those outside the wall experience AI as another force widening income and opportunity gaps, she added.

A person and a humanoid robot shake hands during a tech exhibition held at Coex in Seoul, March 4. Newsis

People, not hardware

That is why some experts say Korea’s AI debate at this point has to focus less on hardware and more on people. They argue that without stronger retraining rights and safety nets — especially for young, precarious workers — AI will mostly reward those already inside secure jobs. This could result in a profound social movement against AI, as already seen in the U.S. and other countries, where people protest data center construction.

“If it becomes clear that AI is just another tool to squeeze more work out of fewer people and quietly sideline the rest, trust will collapse,” Lee Sang-ho, head of the Korean Association of Labor Studies, said.

Legal scholars also point out that these fears point to a deeper problem of Korea falling behind in setting basic ethical guardrails for AI at work. They note that many companies are already experimenting with AI in interviews and performance evaluations, but safeguards such as transparency, contestability and limits on automated surveillance remain vague.

“Even the best-performing system cannot simply replace human judgment in decisions that shape people’s lives,” said Ko Hak-soo, a professor of law at Seoul National University. “The real task now is to design governance so that AI remains a useful tool under meaningful human oversight, not an invisible boss making unaccountable decisions.”