Labor unrest spreads across Korea’s steel, shipbuilding sectors
Labor unrest is on the rise in key South Korean manufacturing sectors as Posco, a major steelmaker, initiated a partial strike on Wednesday, while shipbuilder HD Hyundai Heavy Industries extended its walkout to nearly a full workday.
Posco’s Partial Strike
The labor union at Posco commenced a second round of partial strikes at 7 a.m. on Wednesday, scheduled to last for 120 hours until Monday. This action follows shortly after the company witnessed its first strike in 58 years. The strike targets the No.2 hot-rolling mill at Posco’s Pohang steelworks and the No.4 hot-rolling mill at its Gwangyang complex, with approximately 120 workers participating.
Posco has ensured that production remains unaffected by deploying replacement workers to sustain operations on the affected lines. The escalation of the strike occurred after unsuccessful negotiations during the eighth round of wage talks on Tuesday, leading to the union proceeding with the planned walkout.
The union is demanding a 7.1 percent increase in base pay, along with other benefits, while management has proposed a significantly lower increase, resulting in a considerable gap between the two parties.
HD Hyundai Heavy Industries Walkout Extension
On the other hand, HD Hyundai Heavy Industries witnessed an extension of its partial strike to seven hours on Wednesday, amounting to nearly a full-day walkout. The union, comprising approximately 8,000 members, initiated the strike as part of ongoing negotiations related to wage and collective bargaining.
While the two sides have engaged in talks alongside the strikes, no breakthrough has been achieved as of yet. The union seeks substantial increases in monthly base pay, bonuses, and profit-sharing schemes, while the company’s offers have fallen short of meeting the workers’ expectations.
Concerns Amidst Industry Challenges
Both Posco and HD Hyundai Heavy Industries are facing challenges within their respective sectors. Posco is grappling with declining profits amidst a global steel industry slowdown, driven by weak demand and oversupply issues. On the other hand, HD Hyundai Heavy Industries is navigating through a shipbuilding upcycle, managing a significant order backlog that could be impacted by prolonged strikes.
While production disruptions have not been significant enough to warrant public disclosure thus far, there are growing concerns that extended strikes could potentially disrupt construction and delivery schedules. The situation remains sensitive for both companies as they navigate through labor disputes amidst broader industry challenges.
