Government to Offer Wage Information on 450,000 Workers

The Korean government is implementing a “wage information system” that provides information on the wages of different sectors and job titles. This system will have an impact on corporate wage-making decisions and on negotiations between labor and management.

Many companies, including Hyundai Motor Company and GM Daewoo plan to decide their workers’ wages based on the information from the system.

It is possible that workers who receive a salary much higher than the industry average will see their salaries reduced.

It is said that the Ministry of Labor commissioned the Korea Labor Institute to invent a “Wage Information System.” The system has been in pilot operation from the start of May.

After an additional verification of wage data and statistics, the ministry plans to officially launch the system in the second half of the year. The system was developed by the organization after surveying 456,179 wage earners in 6058 companies that have five or more employees.

The system divides jobs into five main categories: industries, (63 groups); job (145 groups); age (8 groups), education (3 groups); and size of businesses (5 groups). It also has some sub-categories. When a group from each category is chosen, the top 10 percent, bottom 10 percent, average wage and other wage information of each job group is shown.

When an individual’s annual salary is entered, the system automatically shows the individual’s salary ranking within the same job group.

According to the search results of the system, the average annual salary (benefits and bonus included and overtime pay excluded) of all workers surveyed was 28.88 million won. The top 10 percent group average was 52.22 million won and bottom 10 percent group average was 11.5 million won.

The average salary for executives of manufacturing companies with more than 500 employees was 73.62 million won, and that of finance and insurance industry executives was 115.94 million won.

A lack of reliability in reference data, mostly gathered from large companies, used in determining wages used to make company wage management and bargaining inefficient. This is why the Labor Ministry invented the current system.

In fact, the average salary the system indicates is much lower than that of all but a handful of leading corporations.

The Wage and Job Research Team leader of the Korea Labor Institute, Jung Jin-ho, said, “The Wage Information System is the most basic element in introducing a merit system used in advanced countries. The success of a merit system depends on how much emphasis companies place on job evaluation and financial performance based on the Wage Information System.”

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