18 Years On, Hourly Wages Still Stuck at 20,000 Won... "Who Would Work Here?" Plenty of Orders, But No Workers Left [K-Shipbuilding, The Disappearing Skilled Workers]①

More Worry About Workers Than Work to Do

Low Wages Drive Away Young Talent

"Few in Their 20s or 30s Enter the Field

We Might Be the Last Generation"

On June 4, I visited a shipyard in Ulsan. Viewed from the highest VIP lounge on site, the yard was so packed with ships under construction that it was hard to find any empty space. The docks were filled with LNG carriers commissioned by shipping companies from all over the world, and large cargo holds waiting to be installed on vessels were lined up throughout the yard. Cranes moved incessantly, and there was no visible trace of the shipbuilding industry’s “dark age.” However, the expressions of those who had been observing the site for a long time were not entirely bright. While the backlog of orders is sufficient, the problem of workforce shortages has emerged as a new challenge. Beneath the boom in orders, a heavier issue is building up: a decrease in skilled labor and the break in the transmission of technical know-how.

Samsung Heavy Industries Geoje Shipyard panoramic view. The Asia Business Daily DB

Skilled Workers Who Left Have Not Returned

According to the Korea Employment Information Service on June 10, the unfilled job rate in shipbuilding during the second half of last year was 14.4%, 6 percentage points higher than the average across all industries. Production jobs such as plate work, welding, and painting accounted for 29.5% of the total workforce shortage. The issue is not simply that recruitment is difficult. A mismatch in working conditions, a lack of experienced workers, and the avoidance of these job categories have combined, leading to a decrease in the number of people entering the field at all. A representative from a shipyard subcontractor said, “In the past, we worried about not having enough work, but now we worry about not being able to find people,” adding, “It has become even harder to find skilled workers to meet production schedules.”

The root of the labor shortage can be traced back to the recession in the mid-2010s. The collapse of offshore plant orders and a sharp drop in new contracts led to large-scale restructuring, and many skilled workers left the field for the construction and plant industries. Yang Jongseo, visiting professor in the Department of Naval Architecture and Ocean Engineering at Seoul National University, said, “A significant portion of skilled workers who left during the 2016 restructuring did not return to the shipyards,” and “By the time orders recovered, the workers needed onsite had already left.”

Hourly Wages Still in the 20,000-Won Range, 18 Years On

The problem goes beyond a simple shortage of workers; the structure of skilled labor itself is being shaken. According to the Korea Institute for Industrial Economics & Trade, the age group that has decreased the most in the shipbuilding industry over the past eight years is men aged 28 to 35. In contrast, the number of workers aged 60 and older now surpasses those under 27.

A skilled welder who has worked for a subcontractor at a shipyard for 18 years said, “If there are 100 people at the company, there’s probably only one young person among them,” adding, “People in their 20s and 30s hardly ever come in.” He also shared, “In the past, young skilled workers learned their craft by following a foreman, but now it’s rare to see that. I sometimes think that our generation could be the last.”

The incentives to build expertise have also weakened compared to the past. The welder continued, “In 2008, the top hourly wage was about 22,000 won, and now it’s only 25,000 to 26,000 won. Eighteen years have passed, but considering inflation, it’s actually less in real terms.” Welding work at shipyards is done in confined spaces inside ships, where temperatures can exceed 60 degrees Celsius in the summer, requiring heavy equipment and awkward postures. Most days involve long hours standing in conditions with noise, dust, and exposure to hazardous gases. In this structure—where one must endure such difficult and dangerous work for years before being able to work independently—it is hard to see why young people would want to take up welding. In fact, in 2024, 58.5% of new hires in shipbuilding left within their first year.

"Foreman, There Is No One Left to Teach"

In the past, shipyards had relatively clear pathways for passing down technical skills. Workers would build experience at subcontractors before moving to primary contractor production roles or core partner companies as their skills were recognized. But now, this structure has significantly weakened. Jeong Heungjun, professor in the Department of Business Administration at Seoul National University of Science and Technology, explained, “Today, hiring for production jobs at primary contractors has declined significantly. For young workers to develop into intermediate and highly skilled workers, there needs to be a steady influx of new talent, but as this linkage weakens, the ‘waist’ generation that carries on the skills is disappearing.”

The proportion of foreign workers is increasing rapidly to make up for the labor shortfall. However, experts point out that expanding foreign labor alone cannot solve the problem. Lee Eunchang, research fellow at the Korea Institute for Industrial Economics & Trade, said, “Utilizing foreign workers is necessary, but the core issue is the system for skill development. Unless we restore a structure in which young people enter the field and grow into skilled workers, the break in the transmission of technical know-how will continue.” He added, “Shipbuilding is an industry where automation is not easy, so ultimately, the competitiveness comes from people’s skills. With the additional factor of a declining working-age population, the foundation of the onsite workforce itself is weakening.”

Korean shipbuilding maintains world-class competitiveness in high value-added markets such as LNG carriers and eco-friendly ships. However, that competitiveness ultimately rests on the skills of its people. Professor Yang emphasized, “China is approaching shipbuilding from a strategic industry perspective. It’s time for Korea to seriously consider how to maintain the onsite workforce and the system for passing down skills, rather than focusing solely on order performance.”

This content was produced with the assistance of AI translation services.