Work hour reduction comes with both expectations, concerns by economic actors

Published : Apr 30, 2018 - 13:17 Updated : Apr 30, 2018 - 13:17

SEJONG -- Reductions in legal work hours to go into effect from July 1 are raising expectations for better quality of life outside of the office in a country where people put in some of the longest work hours in the world, but they are also fueling worries about lost jobs and wages, economic observers said Monday.

Laws were revised to set legal working hours at 52 per week, down from 68. The new regulations will be applied first at work sites with 300 employees or more.

South Korea has long been known for its torturous work culture, where employees often toil away hour after hour and frequently into the weekends. Asia's fourth-largest economy has the second-longest work hours among countries of the Organization of Economic Cooperation and Development.

Lights remain on at an office building in Seoul with workers still inside on a late evening in this photo from the Korea Chamber of Commerce and Industry. (Yonhap)

The law revisions reflect a growing movement for work-life balance that allows people to enjoy life outside of the office.

Yoon Yoon-gyu, head of the employment policy research division at the Korea Labor Institute, stood by the institute's simulation study result showing that the shorter work hours will create some 110,000 jobs as employers fill in the vacated hours with new hiring.

Yoon also cited better productivity. "Germany's annual work hours are about 700 hours less than ours, but its economy is run effectively," he said. "If a worker works long hours, productivity falls because of exhaustion. It's a matter of course that reduced work hours will improve productivity."

Sung Tae-yoon, a professor of economics at Yonsei University in Seoul, said the latest step is in the right direction but advised allowing flexibility for employers.

"If the new regulations are applied rigidly, they could contract the management's actions and end up undermining productivity and make it difficult to add new desired jobs," he said.

If all companies are strictly required to adhere to the 52-hour rule or face punishment, they could be saddled with a big weight, Sung said.

Others say there are real matters of concern other than productivity and job losses.

"There are many approaches on the assumption that a 10 percent cutback in work hours will create a certain number of jobs, but these are sideline issues," Park Yoon-soo of the Korea Development Institute said. "Protection of workers' safety and health is the central point of work hour reduction."

"Even if there are negative effects economically (from work hour reduction), the government should monitor factors that threaten the safety and well-being of the workers and provide general guidelines on other issues," said Park.

Lost wages were often cited as a growing issue under the new rule.

Yun Chang-hyun, who teaches economics at University of Seoul, focused on that particular issue.

"There will be workers at smaller companies who want to work more hours for more income," Yun Chang-hyun, an economics professor at University of Seoul, said. "If that is not allowed, then income replacement can become a problem."

Yun said he agrees that work hours need to be shortened but argued that there has to be flexibility, such as allowing more of a grace period for employers and exceptions to the rule depending on circumstances.

Yoon of KLI said improved productivity may offset the lost wages, although this would lessen the number of newly created jobs. Under such conditions, the key solution would be agreements by management and setting appropriate salary levels, he said.

Despite the growing call for a balance between work and life, the older generation may not be so willing to embrace it, according to Yoon.

"Younger people will welcome the balance in life, but older people have a culture of emphasizing work over family. They may feel at a loss if they are suddenly told to go home early," he said.

The sought-after effect on life outside of work may not go evenly to every worker, Sung said.

"People in the high-income sector may see the effect of improved quality of life, but for people in the low-income rung, the outcome of lessened wages could be bigger than better quality of life," he said. (Yonhap)