Park Byung-kyu once led Kia Motor’s union in the city of Gwangju, fighting for labor protections against the powerful, family-run chaebol that dominated the economy during South Korea’s rapid industrialization.
But about 20 years ago, Park was assaulted by unionized workers wielding steel clubs after he campaigned for the rights of temporary workers at another company, leaving him paralyzed on the right side of his body.
The attack also left him disillusioned with the approach of South Korea’s forceful and often militant unions, which have faced increasing criticism for protecting their interests at the expense of other workers.
Now, Park is working for the city of Gwangju on a proposed joint venture with Hyundai Motor to build a new low-wage car factory, Hyundai’s first new factory in South Korea in 25 years.
The $616 million plant would create 1,000 jobs, but at less than half the wages of Hyundai’s unionized workers and without many of the privileges they currently enjoy.
“The labor unions with vested interests should change. If not, their interests will be taken away,” said the 53-year-old Park. “Unionized labor should face up to the reality.”
The unions of Hyundai and affiliate Kia Motors, which together form the world’s fifth-largest automaker by volume, have staged strikes and rallies to protest the plant.
They say it will create “bad jobs” and take away production and employment from existing factories.
But in a city that has seen a steady exodus of manufacturing jobs move to low-cost countries, many job seekers say they would work for the plant in a heartbeat.
Employment is a key focus for President Moon Jae-in’s administration as Asia’s fourth-largest economy struggles to create jobs in the face of a slowing China economy, U.S. trade protectionism and increased minimum wages.
The Moon government plans to provide financial assistance to the Gwangju plant, and also introduce similar government-business ventures in two other cities by June.
Officials hope it will lead to a “U-turn” of Korean companies which would otherwise build factories overseas.
“This is a bold experiment to resolve jobs and labor relations problems,” said Park Myung-joon, a senior research fellow at state-funded Korea Labour Institute, who has been involved in the project since its beginning in 2014.
The carmaking venture, the first of its kind in South Korea, is the biggest threat to date for legacy unionized auto workers, who have largely maintained high wages and benefits even with youth unemployment near a record high and the economy sluggish, Park said.
“The expensive union jobs will gradually disappear.”