Labor Market & Employment Policies

Non-standard Workers of Korea : Changes in Size and Composition -Analysis of the Supplementary Survey to the Economically Active Population Survey of March 2008-

• Date August 27, 2008
• Attach e_80.pdf

* This paper was originally released in Korean in the 42nd issue of the Monthly Labor Review published by the Korea Labor Institute in June 2008.


* Lee, Byung-hee, Director, Data Center, Korea Labor Institute (lbh@kli.re.kr)
* Jeong, Seong-mi, Senior Researcher, Data Center, Korea Labor Institute (smjung@kli.re.kr)


Ⅰ. Background

The purpose of the Act on the Protection of Fixed-term and Part-time Employees is to mitigate unreasonable discrimination against non-standard workers while acknowledging diversity of employment types. To prevent over-utilization of non-standard jobs, the Act limits the maximun duration of their employment. As of July 2007, the 2-year restriction on fixed-term employment contracts is imposed on all workplaces. Corrective measures to prevent discrimination against fixed-term and part-time workers were phased in, first to private companies with 300 or more employees and public organizations (July 2007), to be followed by those with 100-299 employees (July 2008), and those with less than 100 employees (July 2009).
Despite its intent to enhance labor market fairness, however, the Act was subject to much controversy in the course of implementation. Although some large, financially able companies converted their fixed-term contracts to open-ended ones, by switching the previously non-standard workers to standard workers, adopting "separate job category schemes" or installing lower positions, some others either terminated their contracts or increased indirect hiring in the form of dispatched workers, temporary help agency workers or sub-contracting. In particular, "outsourcing," subject to no legal restrictions, was largely seen as a way to circumvent the Act, leading to labor-management strife. Some even pointed to the Act as the main culprit for sluggish job creation.
This study aims to analyze the change in the size and composition of non-standard workers using the Supplementary Survey to the Economically Active Population Survey conducted by the National Statistical Office in March 2008. The previous survey was conducted in Aug. 2007, immediately after the Act went into effect, which makes it too early to assess the labor market response, but this survey is likely to provide information to better understand changes in the market. It should be noted that a simple comparison between the March survey and August survey would not be appropriate due to seasonal factors. Thus, regarding the changes in employment types, the March 2008 Supplementary Survey will be compared with the March 2007 Supplementary Survey.