Continued from Part 1



The Chung Ju Yong’s and Chun Tae Il’s of the Korea meet, as it were, at the workplace where production takes place.  There it is that Chung’s genius and moral authoritarianism get transposed into a subsystem that controls the lives of Korea’s workers.  During the 1970’s that subsystem contained four components.

Management by Decree

The first component of the system was plant management.  It had the task of keeping labor costs as low as possible.  To do that, management had to hire workers and keep them productive at minimum wages.

Each year the Economic Planning Board (EPB) would indicate a maximum rate of increase above which wages should not go.  The employer would use that rate to guide him to setting wage increases at his own company.  If possible, the rate could be set lower than the EPB level, but if it went above, the employer might find that his financial credit at the bank had been reduced or withdrawn.  Pressure from the EPB was kept on the management to resist any excessive demands by the workers.  Employers, however, participated in the EPB’s decision-making process and therefore actually helped set the rates of permissible increase.  The system in practice had a lot of slippage.  Government enforcement tended to be erratic.  In most cases actual wage determinations were in the hands of the employer. If the employer were a chaebol, decisions on wages were made at corporate headquarters and then communicated down to the subsidiaries. It fell to the management of each plant to enforce the decisions made at higher echelons.

It worked.  Throughout the decade of the seventies, wages were kept low.  Workers’ lives were humble indeed.  Even by the end of the decade only ten percent of employees in manufacturing and mining were earning incomes equal to the government established minimal standard of living, and only half made as much as fifty percent of that standard.  Workers lived at subsistence, while out-producing the world.  Labor productivity always stood at levels considerably above the levels of worker income.

Another way by which management kept labor costs low was to insist the workers remain on the job long after they finished the 48 hours set down by law.  The extra hours were often not paid for or paid at a rate less than the time and a half prescribed by the Labor Standards Act.  The Tonga Ilbo newspaper reported, for instance, that as recently as 1983 workers on average put in 33.5 hours a month without any compensation from the employer, and in addition in just six months of that year 230 firms were either delinquent in their payment of wages or paid none at all.  Such was the case throughout the 1970’s.  Korean employees worked more hours per week than workers of any other country in the world.  The official figure was about 54 hours a week, but in actuality sixty hours would have been a more accurate figure.  The popular American magazine Fortune, looking in upon these long hours of labor interpreted them in these words:

What positively delights American businessmen in Korea is the Confucian work ethic….  Work, as Koreans see it, is not a hardship.  It is a heaven-sent opportunity to help family and nation.  The fact that filial piety extends to the boss-worker relationship comes as a further surprise to Americans accustomed to labor wrangling back home.

Fortune would have been more accurate if had noted that a refusal to work those long hours would have resulted in dismissal, and that the hourly base wage was so low that without the long hours the workers and their families could not have survived.

Ignoring safety and health considerations was a third strategy used by management to keep labor costs down.  Along with the long hours went one of the worst safety records in the world.  In 1978, one year, 1397 workers were killed on the job, 13,013 were partially or totally disabled and 137,845 suffered serious injury.  These are the statistics of only those incidents which were reported.  The real figures could have been double that – or more.  Seven years later, in 1985, these sorry figures were even worse.

Under Yushin, management by decree was the front line of control over labor.  Orders from above kept labor costs low.

Union Manipulation

The second component in the 1970’s subsystem of worker control was the manipulation of unions.  During the 1960’s a provision in the nation’s constitution protected the rights of workers to free association, to collective bargaining and collective action.  Under Yushin, those rights were at first suspended and then only the first two reinstated.  An emergency decree in 1973 declared all work stoppages to be illegal.  Unions, however, were permitted to organize and operate along lines similar to those practiced in the 1960’s.  In fact most unions were organized on a “union shop” basis, so as Korea’s industrial work force expanded so did its labor union membership.  During the decade union membership grew from 473,256 to 1,093,679.

The increase in numbers, however, signified very little.  Following tradition built up since No Chong’s victory over Chun Pyung* in the mid-1940’s, management always intervened in union affairs to assure who should or should not be chosen as union officers. Union decision-making power was controlled by management with only superficial input from workers.  The ritual of collective bargaining was practiced each year in the spring. New contracts were signed. In 1978, as one example, 872,000 workers were reported to have been covered by 3205 collective contracts.  What the figures do not disclose is that the content of the contracts was primarily a repetition of items already written in one of the labor laws.  Wage increases were included as part of the contract agreement, but they were for the most part perfunctory and determined not by collective bargaining but by joint decision of employers and the EPB.

As management manipulated unions at the local level the Korean Central Intelligence Agency (KCIA) performed the same function at the national level.  It kept the Federation of Korean Trade Unions (FKTU) under its wing.  Through the FKTU structures, the KCIA could control the seventeen member nation-wide industrial unions.  The industrials in turn exercised a decisive influence on the locals. This hierarchical system of control was cumbersome and at times was not as efficient as the KCIA would have preferred.  It would have been easier for them if unions at all levels could just have been abolished, but as a “client” of U.S.A., the champion of democracy, Korea could not totally do away with labor unions.  That would have appeared too  undemocratic.  The Korean government also maintained itself as an observer at the International Labour Organization (ILO), and FKTU is affiliated with the International Confederation of Free Trade Unions.  Furthermore, as mentioned above, the American AFL-CIO has a branch office called the Asian American Federation of Free Labor Institute in Seoul.  Despite the fact that none of these Western bodies lifted a hand to restrain the oppression of the seventies, still it would have been impolitic for the Korean government to have snuffed unions out all together.  Therefore they had to use them.  FKTU leadership was kept in the hands of the KCIA.  The FKTU always agreed with government labor policy even if the policies were counter to worker rights.  When at the local level a serious dispute arose, the KCIA could send in an FKTU officer to persuade local leaders to obey the company.  If that failed, FKTU would use its legal authority to disband the local and take direct control into its own hands.

From the perspective of the innovators, the control and manipulation of labor unions worked very well.  Labor-management disputes were minimal and, with a few exceptions, actual work stoppages were seldom.  The impact of organized labor on wages seemed to be well under control.


The third component in the subsystem of control in the seventies was propaganda.  Workers were constantly bombarded by government and management propaganda intended to spur them on to greater heights of production.  Appeals to patriotism and anti-communism were used to instill a sense of loyal urgency into the workers.  Education programs, the “New Village Movement”** and exhortations by owners like Chung Ju Yong were aimed at creating the image of a nation under siege whose very existence depended upon the loyal obedience of workers to their superiors.

At each plant a Joint Labor-Management Council was established so that the teachings about loyal cooperation could be put into practice.  If workers recognized the great urgency to increase production, they would, it was thought, join management in overcoming all impediments and bottlenecks.  The problem, however, was that neither management nor government knew how to cooperate.  Traditional authoritarian patterns dominated the Councils.  Worker representatives were selected, or approved, by the company, the agenda was set by management and the decisions made were usually quite insignificant.  The Joint Councils were but part of the subsystem of worker control.  They were part of a propaganda campaign to manipulate workers.


The fourth component of labor control under Yushin was that of fear. Yushin was tantamount to the militarization of the entire society. An endless variety of “law enforcement” agencies permeated all aspects of Korean life.  There were the regular police and plainclothes policemen and women; there were riot police who were not police, but soldiers trained in controlling demonstrations; there was the army of invisible spies hired to penetrate the universities, the churches, unions, businesses and civic organizations; and there was the KCIA, most feared of all because it struck at night, condemned the victim to the stigma of “communist” and tortured him/her into compliance.

The factor of fear was central in the control of labor.  The KCIA, and its informers, seemed to be ubiquitous.  Any suggestion of opposition or criticism about wages, FKTU, education programs or anything else was sure to bring reprisal.  That probability in and of itself tamed most workers and union officers.  Those who were of a more hardy constitution received individual treatment.  If a union leader were stubborn enough to persist in a dispute over wages, the consequent scenario might go like this: a black jeep with a driver and two KCIA agents would likely pick the unionist up early some morning.  Four days or a week later he would be returned to his home and his job.  He would be hesitant to talk about his experiences of the previous days, but he would let it be known that he no longer really opposed the company’s position in the wage dispute.  An agreement would be reached and signed by both sides.  Not long afterwards, it would surprise no one if the union leader were to resign and leave the company, perhaps move to another city altogether.



How did the subsystem with its four components of control work out in practice?  Apparently quite well from the innovators’ perspective. Wages were always kept comfortably below productivity and this certainly contributed to Korea’s increasing rates of domestic savings and investments which in turn strengthened its standing in international financial markets.

From another perspective, however, the answer is more equivocal.  The innovators tried to impose two contradictory systems upon the nation’s workers.  On one hand they suppressed labor costs by manipulating unions, expanding hours, and disregarding safety; but at the very same time they demanded cooperation in order to expand productivity.  The two are quite contradictory and in fact the innovators paid very little except lip service to the idea of cooperation.  Their main energies were expended on the “suppress” side of the ledger. Given the “superior class” mentality of the innovators that pattern was quite to be expected.  Indeed it seems almost ludicrous to think of a Chung Ju Yong actually seeking cooperation from Chun Tae Il – obedience, yes; cooperation, hardly.  Consequently, throughout the 1970’s, as the working class expanded in numbers and increased in levels of education, their sense of han, outrage and alienation was also boiling at a more rapid rate.

Statistics from the Korean Development Bank suggest something of what was going on under the surface.  For the first three years under the dictatorship productivity increases doubled those of wages.  In the next four gradually the relationship was reversed.  Real wages increased by a rate of 18.3 percent while productivity rose only 7.8 percent.  Given the levels of control over unions and the efficiency of the EPB’s system those statistics, if at all accurate, are surprising.  One would have guessed the exact opposite.  If union suppression would keep wages down, certainly the 1970’s should have accomplished that.  If government and company exhortations through Joint Councils and ceaseless education could push up productivity, then productivity should have gone sky high.  Perhaps somewhere in the mid-seventies, an inverse reaction set in.  Suppression of personal and collective freedoms may have led to reduced efforts toward productivity.  Perhaps the sham harmony of the Joint Councils bred resistance rather than cooperation. Throughout the 1970’s, however, worker resistance was of the quiet, stubborn sort.  Only women workers in textiles and electronics openly challenged the enforcement system nurtured by the innovators.


To be continued in Part 3



*Chung Pyung, or the All Korean Labor Council, was a workers coalition established in 1945 immediately after Korea’s liberation from Japanese colonial rule.  It was a national federation of organizations of workers who had taken over the management of factories abandoned by the Japanese.  No Chong, or the General Federation of Korean Labor Unions, backed by Syngman Rhee and General John R Hodge of the U.S. Army Military Government, wrested control of labor from Chun Pyung in 1945-57.

** The “New Village Movement,” or Saemaul Undong, was a political initiative launched in 1970 by then-president Park Chung-hee to modernize the rural South Korean economy through appeals for diligence, self-help and collaboration to participate in the development process.



George Ogle spent twelve years with Korean industrial workers in Incheon as a “factory chaplain” of Urban Industrial Mission but was deported in 1974 for speaking out on behalf of eight men, accused of being part of a communist conspiracy then tortured and executed by the Park Chung-hee government.  He returned to Korea in 1989 to write South Korea: Dissent within the Economic Miracle about the history of worker struggles that gave birth to South Korea’s modern labor movement.  As we strive to understand the current labor-management standoff in South Korea, Ogle’s historic account sheds light on the origins of South Korea’s labor repression and dissent.

With the author’s kind permission, ZoominKorea reproduces select chapters from South Korea: Dissent within the Economic Miracle as a special series. Part 2 of the series is from Chapter 4 of the book.

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