Do Foreign Workers in Korea Truly Benefit Financially?
The Perils of Korea’s Foreign Worker Permit System
In Korea, there are two terms that refer to foreign residents: “foreigners” and “foreign workers.” Foreigners are, quite literally, people from abroad who are visiting or living in Korea. This term covers a wide range of nationalities and social classes, from foreign students to expatriates to tourists. However, unlike the term ‘foreigners,’ ‘foreign workers’ carries a special meaning. It refers to workers from less developed countries in Asia who are living in Korea with the express purpose of earning money.
So, do these foreign workers earn the money they expect to make by locating in Korea, even as defined by discriminatory terms? The answer to this question is complicated and, above all else, points to the need for reform.
Foreign Workers in Korea
Foreign workers in Korea began entering the country under the employment permit system(EPS), which took effect in 2004. The employment permit system was designed to solve the workforce shortage in 3D industries such as manufacturing, agriculture and livestock, fisheries, and construction, which many Koreans avoid. Foreign workers entering the system obtain E-9 or H-2 visas.
The nationality of foreign workers who obtain E-9 visas is primarily comprised of less developed countries in Asia. According to data from Statistics Korea (KOSTAT), in 2020, 6,688 people from 16 countries – including 2,172 from Cambodia, 955 from Nepal, 700 from Myanmar, and 641 from Indonesia – entered Korea with E-9 visas. By way of comparison, in 2019, before the novel coronavirus outbreak (COVID-19), 51,365 people from 16 countries – including Cambodia, Nepal, Vietnam, Indonesia, Thailand, Myanmar, Philippines, Sri Lanka, Uzbekistan, Bangladesh, Mongolia, East Timor, Pakistan, China, Laos, and Kyrgyzstan – entered Korea with E-9 visas.
The H2 visa is a special visa for Korean descendants who live abroad. Representatively, Koreans in the former Soviet Union, including Russia and Uzbekistan (they are referred to as ‘Koryŏ-in’), and ethnic Koreans in China (They are referred to as ‘Chosun-jok’) can work in Korea with an H2 visa in hand. Koryŏ-in refers to Koreans who moved from Korea to Primorye Province when Japan occupied Korea in the late 20th century. There are many theories about this period of movement among Chosun-jok, but it is commonly characterized as a group of Koreans who emigrated from the Korean Peninsula during the late 20th century during the Chosun Dynasty and the Japanese colonial era. After the founding of the People's Republic of China, they became members of China's ethnic minorities under the term ‘Chaoxian-zu(Chinese pronunciation of Chosun-jok).’
Money Earned by Foreign Workers in Korea
The purpose of foreign workers who come to Korea from less developed countries in Asia is to make money through their labor. According to relevant data, on the surface, foreign workers seem to have come to Korea and successfully made money.
According to data from the Ministry of Justice and KOSTAT, 72% of foreign workers with E-9 visas earned at least 2 million Korean Won (approximately $1785) a month in May 2020. Some 26% earned an average monthly income of 1 million to 2 million won, 63% earned 2 million to 3 million won, and 9% earned more than 3 million won. The relative standard error for earnings of less than 1 million won was more than 25%, and as a result, this income level was not counted.
The results do not differ markedly from Korean employees. According to a survey released by the job portal Incruit in 2020, the average starting salary of new Korean employees of small and medium-sized enterprises (SMEs) with less than 30 employees was 2.31 million won per month. In light of the fact that foreign workers are usually engaged in simple jobs at SMEs, there is no significant difference in firms’ treatment of foreign workers when compared with new small and medium-sized companies targeting Koreans.
Compared to per capita gross national income (GNI) in Cambodia and Nepal, foreign workers in Korea earned more than they would have had they worked in these countries. Additionally, 73.1% of foreign workers in 2020 cited "high wages" as the reason for choosing Korea as an overseas employment destination.
Money Lost by Foreign Workers in Korea
However, foreign workers in Korea are losing money in blind spots, including labor and human rights. They are not receiving the true price of their labor due to unpaid wages, low wages, and prolonged labor problems at labor sites.
According to a report released by the Busan Development Institute in March 2021, 31.5% of the problems raised by migrant workers to the Busan Foreign Resident’s Center were related to overdue wages. Other problems raised in order of prevalence include medical and industrial accidents (14.8%), multicultural families (11.0%), employment permits related to workplace changes (7.8%), granted status of stay changes (7.7%), and labor conditions (6.5%).
According to the "Foreign Workers Wage Deficit Report Status" submitted by Yoon Mi-hyang, a member of the National Assembly's Environment and Labor Committee, in October 2020, the number of foreign workers awaiting payment of overdue wages in Korea has surged every year, surpassing 100 billion won for the first time in 2020. According to a report published in January 2021 by the Korea Labor and Society Institute, migrant workers endure long hours of labor and low wages, with ‘restrictions on workplace movement’ and ‘short-term labor cycle policies (up to 9 years and 8 months).’
The reason why foreign workers lose money is that their visas are dependent upon their employers. Foreign workers must work at the workplaces of employers who have signed labor contracts before workers have entered the country. Additionally, foreign workers can move to other workplaces only when they have "approval from the employer whom they will leave." If more than 30% of a year's wages are overdue, or if violence, sexual violence, or discrimination occurs, a foreign worker can move, but in this case, the worker must prove the damage by himself. Therefore, in fact, he or she cannot actually move without the employer's cooperation. If foreign workers in Korea want to move to another business without the cooperation of business owners, they will be reduced to illegal immigrant status.
To date, South Korea's Ministry of Employment and Labor has focused on cracking down on illegal immigration without revising these toxic statutes. First and foremost, it appears necessary to establish the right working environment and refine policy objectives.
[By Sejin Kim]
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