Korea's leading shipbuilding industry to suffer though losses until rebounding: Expert

고난의 조선사: 위기의 산업, 앞날은
And, one main sector grappling with the ongoing restructuring efforts... Korea's shipbuilding industry.
In this final installment of our two-part special report, our Shin Semin takes a look at just how much weight the industry carries in the overall Korean economy,... and whether there is hope for recovery.

One by one, troubled shipbuilders have or are submitting their self-rescue plans to creditors and the government,... which include steeps cuts in the workforce and wages, as well as the sale of non-core assets.

The size of the industry is immense,… which means the losses will be, too.
A local investment firm projects a drop in economic growth of point-two to point-four percentage points, if shipbuilding production levels drop by 10 to 20 percent.

The industry takes up one-point-eight percent of the country's entire economy,… with 200-thousand workers.
With the ongoing corporate restructuring expected to push out at least 30-thousand employees, experts project the overall unemployment rate will leap to over 4-percent.
A cut-back of 50-thousand workers… would push that rate up to 4-point-1-3 percent.

"The impact of corporate restructuring on workers, who make 37-hundred dollars per month on average, is going to be immense,… cutting household spending and production,… and driving down the already stagnant domestic economy even further."

The downfall of the industry was somewhat foreseen.
Shipbuilders had already seen a drop in demand since 2008,... and jumping into the offshore plant business, once thought of as a blue-ocean, only amped up risks.
The lack of knowledge about the new market led to combined losses worth over five-point-seven billion dollars.

But the prospects are not all glum.
Experts say that if shipbuilders can weather through two to three years, life will return to their shipyards.

"Every industry goes through a slump,... and this is one not just for shipbuilders in Korea but worldwide. They need to prune their branches,... but only to a certain extent,... to give the sector room to grow back once conditions return to normal."

But, there is one condition.
Experts say, securing high-skilled workers and not losing them to competing shipyards in other countries like China is key.

"They emphasize the government should shoulder a lot of this responsibility by retraining those who have lost their jobs to secure their livelihoods and help them reclaim their jobs to sustain the longevity of the industry."
Shin Se-min, Arirang News."

Visit ‘Arirang News’ Official Pages

[伊藤博文-ej]

Nothing can save this sinking shipbuilder. I give you a good suggestion! Don't spend any Korean tax for the sinking ship! That will increase the death toll.