Korean Job Discussion Forums

[mervsdamun]

The post below gives an overview of the job market as a whole. I thought this would be at least semi-interesting to readers of this forum, even though it does not deal specifically with the English teaching market.

To compare this with other countries in Asia go to the following website and select the country of interest (under HR Publications):
http://www.pacificbridge.com/index.asp


For Korea see:
http://www.pacificbridge.com/publication.asp?id=95


General

South Korea�s economy is expected to grow by more than 4.5% in 2007. Domestic spending is likely to grow more than expected, while exports will continue to post double-digit growth.

As Asia�s third-largest economy becomes more knowledge-intensive, employment of professional technicians and knowledge workers has also increased. In contrast, the demand for unskilled workers in manufacturing and office chores is expected to decline.

Korean workers are generally keen to upgrade their skills and increase their professional development. Many are also interested in lifelong learning. As a result of Korea�s ageing population and a decline in population growth, the demand for education and training to enable the older population to remain employable has remained high.

Wages and compensation

Although salaries for Korean professionals are generally lower than those for their American counterparts, they have been increasing over the past few years. Top employees and expatriates, of course, remain expensive, particularly with the appreciation of the Korean won against the U.S. dollar.

Many large Korean companies pay a bonus equivalent to one month�s salary four times a year. However, this practice is less commonly observed in foreign firms. Some foreign companies now prefer incentive-based systems.

Other Benefits

Under Korea�s Medical Insurance Act, all companies are required to offer insurance coverage for their employees. These include inpatient, outpatient, nursing and funeral expenses, where employees generally co-pay around 20% of the total amount. However, there is no mandatory sick leave policy in Korea. Companies generally determine their own sick leave policies.

Under the country�s Employment Insurance System, full time and part-time employees who work more than 15 hours a week receive unemployment and disability benefits. Employers and employees each contribute around 0.5% of employees� monthly salary.

Under the National Pension Law that came into effect in 1998, employers and employees each contribute 4.5% of monthly salary. Payout at retirement usually depends on years of service, monthly income, and number of dependents.

HR Regulations Update

Work Visas for Ethnic Koreans - In June 2006, a new visa ruling was introduced for Koreans with foreign nationality. The H-2 visa will make it easier for companies to hire ethnic Koreans in construction and service jobs. It will also allow ethnic Koreans to freely enter and leave the country for three years, and switch jobs without changing visas.

Pension System Reforms - Due to Korea�s rapidly ageing population, a reform of the pension system is likely to be implemented between 2010 and 2020. This will lead to increased contributions by both employers and employees from the current combined 9% of monthly wages to 12 - 13%. It will also lead to a reduction of post-retirement pension payments from 60% of former salary to 50% initially, and 40% later on.

Increased Health Care Premiums � As a result of the country�s ageing population, National Health Insurance premiums will increase by 6.5% in 2007. Currently, employers and employees each contribute 2.2% of monthly salary to the health care insurance fund.

Work week, Overtime and Immigration Policy

Right now, Korea�s work week is in transition from 44 to 40 hours per week. Beginning in July 2007, all companies with at least 30 employees are required to switch to a 40-hour work week. But full implementation of this ruling will be difficult, given the country�s hierarchical mindsets and traditional work ethic. Generally, if bosses or older colleagues have not left the office for the day, subordinates and younger colleagues would not leave the office either. Even though many lamented that longer hours do not necessarily mean higher productivity, the situation is still well entrenched at many work places.

In terms of overtime, blue-collar workers must be paid for all hours worked beyond the regular workweek. Generally, a 50% premium is required for all overtime work.

Under Korea�s immigration policy, foreigners are allowed to work in the country on a case-by-case basis. Foreigners generally occupy senior level positions and are relatively more expensive to hire. Given the highly educated Korean workforce, it is generally less expensive and equally effective to hire locals or returnees.

Labor Relations

Korea has often been known for its militant labor unions. Recently, the Institute of Management Development ranked Korea last among 61 countries in terms of competitiveness of labor relations. More workdays per year have been lost to labor disputes in Korea than in any other developed country.

The unstable labor environment has hurt the country�s economy. General Motors and Carrefour have both experienced costly strikes in recent years. FedEx and DHL have chosen China over Korea as their regional hub. Many Koreans are aware that the country�s militant labor is in danger of eroding Korea�s competitiveness in the long run. But despite vocal calls to curb the militant nature of the unions, little headway has been made.

But those who are more sympathetic to Korea�s labor situation argue that industrial relations are not the sole factor in making foreign investment decisions. Other matters of importance include a country�s political and institutional stability, quality of human resources systems, market size, and the possibility of exporting to neighboring countries.

Recruiting Strategies

Relationships and Networking - One common method of recruitment in Korea is based on relationships and networking. Family members, relatives, friends and alumni are often good sources for referrals and recruitment.

Koreans are generally interested in opportunities for career advancement and development. Hence, when recruiting candidates, foreign firms should make growth potential and other career opportunities clear to prospective employees. And although lifetime employment is not as common as in Japan, the concept is still very attractive to many Koreans.

Campus Recruiting � Another common method of recruitment is heading to top universities in the country. The top three universities are collectively known as �SKY�, or Seoul National University, Korea University and Yonsei University. Recruitment of students takes place twice a year, and competition is usually stiff for positions in top local and foreign companies.

Internet Recruiting � Some of the more popular recruiting websites include http://www.jobkorea.co.kr, http://kr.dir.yahoo.com, and http://www.koreajoblink.com. Internet recruiting is generally more successful in hiring entry-level candidates, as young Koreans are among the more wired and internet-savvy in Asia. But when hiring for senior positions, more conventional methods such as headhunting and advertising in specialized trade and professional publications are generally preferred.

Recruiting Trends

Korea�s workforce is highly educated and the pursuit of post-graduate degrees by Koreans is one of the highest in the region. Many graduates and post-graduates are ambitious, driven and have high career expectations.

Hiring Fresh Graduates - In recent years, companies in Korea have been hiring employees based primarily on age. Companies have indicated that they would hire only new graduates, and would not even consider those who had graduated two to three years ago. These companies feel that fresh graduates are easier to train, more creative, can learn and grow more quickly and are capable of offering many years of service to the company.

Women in the Workforce � Despite being perceived as one of the most male-oriented societies in Asia, Korea has witnessed an increase in the participation of women in the workforce. Women now constitute a record 42% of the workforce. 60% of new jobs in the financial sector also went to women in 2006. In the case of the IT sector in 2006, 38% of graduates were women. Indeed, the country even appointed a female Prime Minister in 2006. More women are also increasingly represented in senior managerial and executive positions in Korea today.

Although there is still some discrimination against women in the workplace, employers have generally realized the benefits of hiring women. Many firms are also doing their best to recruit and retain highly qualified women.