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Thursday, July 30, 2009

Made in Korea

Lee Hyori on the blog two days in a row? What's going on?!

This exchange between two 13-year-old boys in Talk Show class was classic:

Student 1 (Host): Where are you from?
Student 2 (Guest): Made in Korea!

Robin Hood (yes, that is his English name) knew he was making a joke and I was suitably impressed, considering that he hadn't demonstrated very strong English skills during class up to that point. It was such a good line -- in his eyes as much as anyone else's -- that he repeated this statement about five more times before the 45-minute period ended.

(In the vein of Stuff White People Like, there's a great blog called Stuff Korean Moms Like and #22, interestingly, is "Made in Korea": "Don't ever show your Korean Mom something you bought for a lot of dough that was not made in Korea. She will take it as a personal slap in the face.")

In the United States, almost everything we buy is made elsewhere. Just looking around the immediate area, my dress was made in Sri Lanka, my camera in Japan, my clock in China and my bathing suit in Indonesia.

Korea is a huge manufacturing center for many multinational corporations -- besides Korean brands such Samsung, Kia, Hyundai, Fila and LG, other companies including Nike outsource work here to take advantage of a cheap, diligent workforce.

Consider that the average family income in Korea is a little more than 39,000,000 won (about $31,330 USD). Compare that to the 2007 median U.S. household income of $50,740. The cost of living in Korea is much less than in the United States, accounting for much of the discrepancy, but you can see why outsourcing to Korea would be an attractive option to a company. Costs go down, profits go up.

A 2005 study by the Korea Trade-Investment Promotion Agency reported that "Korea was rated as the most attractive outsourcing partner by the biggest U.S. automakers for its high quality and price competitiveness."

The interesting thing about all of this is as American companies send more work to Korea, Korean companies are sending their work elsewhere (and importing cheap goods from many of their Asian neighbors, particularly China). South Korea has even entertained the idea of outsourcing labor to its not-so-friendly northern neighbor. And many Korean car companies have factories in the United States, so oddly, maybe it all balances out in the end.

One of the big news stories here is a strike at a Seoul car plant -- nearly 1,000 fired workers and sympathizers took control of the Pyeongtaek factory May 31 and say they won't leave until every person is guaranteed his job back.

Though South Korea has a history of labor unrest, the trouble at Ssangyong stands out in a time when the government has persuaded many companies and unions to avoid confrontation during the economic downturn. The government pressed companies to use pay freezes, job-sharing and other methods rather than layoffs to curb costs, and pushed unions to accept such measures.

After several raids and forcible attempts by police to breach the building -- no food has been sent in for two weeks and water and gas have been shut off for more than a week -- talks are set to begin today between union representatives and plant management.

Which all goes to show that if you want your business to run smoothly, keep your employees happy. Don't fire them for no better reason than profit margins or you could end up with a similar situation on your hands.