Seoul, Sep 22 (IANS) South Korea’s labour productivity remains low compared with advanced countries, a report showed on Monday, raising concerns over the push for shorter working hours without first improving efficiency.
According to the report, co-published by the Sustainable Growth Initiative (SGI) under the Korea Chamber of Commerce and Industry (KCCI) and professor Park Jung-soo of Sogang University, South Korea’s annual labor productivity, measured as gross domestic product (GDP) per employed person, stood at US$65,000 in 2023, ranking 22nd among 36 member nations of the Organization for Economic Cooperation and Development (OECD).
The figure is far below the $125,000 of Belgium and the $144,000 of Iceland, both of which have adopted a four-day workweek system.
France, Germany and Britain, which are conducting trial four-day workweek programs, posted $99,000, $99,000 and $101,000, respectively.
“A reduction in working hours will improve job satisfaction and expand leisure time, leading to increased consumption,” the SGI said. “For companies, however, a reduction in working hours without improving productivity will decrease output and raise labor costs, adding to the financial burden.”
The report also noted that wage growth has outpaced productivity gains since 2018 amid a global slowdown and domestic factors, such as minimum wage hikes.
Annual salaries rose by an annual average of 4 percent between 2018 and 2023, while labor productivity advanced 1.7 percent per year. From 2000-2017, both salaries and productivity grew 3.2 percent annually.
The SGI stressed that while reduced working hours may enhance the work-life balance, improving corporate management conditions should be prioritized given South Korea’s low productivity and slowing growth.
It recommended flexible working hour arrangements for certain industries, more manageable wage systems, and policy support for small and medium-sized firms.
President Lee Jae Myung has proposed adopting a four-day workweek as a long-term national goal, one of his key presidential campaign pledges.
–IANS
na/
