[The Editors' Verdict] Hopes and Concerns About MZ Generation Labor Unions

The 2030 MZ generation, who were supporters of the ruling party, overwhelmingly chose the opposition party in the Seoul mayoral by-election. The MZ generation's unexpected shift was foreshadowed by issues such as the conversion of irregular workers at Incheon International Airport Corporation and the hiring corruption at Seoul Metro. Angered by the lack of fairness, the MZ generation is now forming labor unions for office technical workers. Such unions have already been established in IT service industries like Naver and are recently spreading to large manufacturing companies such as Hyundai Motor. This movement could become a starting point for political and social transformation beyond merely protecting their own interests. Just as their parents' generation played a role in dismantling the authoritarian labor relations system by forming unions during the June Democratic Movement of 1987, the MZ generation is attracting attention for whether they can break the contradictions of the ‘87 labor relations system’ that foster high costs, low efficiency, and inequality.

Compared to their parents and uncle generations, the MZ generation thinks more freely and shows less interest in unions. They reject partisan logic, are proactive about change, and respond rationally. Although they raise concerns by investing in real estate, stocks, and even Bitcoin, sometimes by borrowing money, they remain neutral toward risk. They show little concern for the community but have great interest in their own future and financial management. Without institutional mechanisms to encourage mutual survival and coordinate interests, the establishment of MZ generation unions could lead to worsening inequality and other problems. Technological innovation tends to increase income disparities based on skill, and if combined with union power, these disparities grow further. Demand for high-skilled labor using IT is rapidly increasing, but the training of high-skilled personnel is relatively insufficient, so MZ unions centered on skilled workers gain bargaining power. As a result, wage competition among large IT service companies intensifies. The average annual salary of these MZ generation employees has already exceeded 100 million won, and Naver has committed to providing an additional 10 million won worth of stock annually for three years.

For the benefits of technological innovation to be distributed evenly among workers, companies and the government must also innovate. Temporary measures that soothe MZ generation dissatisfaction with wage increases are ineffective. Companies must recognize their value and help open their futures. Google, which greatly influences Korean IT service companies, introduced the ‘20% rule,’ allowing all employees to spend at least 20% of their weekly working hours developing new services. Gmail and Google Maps are results of autonomous and creative labor. Bosch, a global automobile company, divides all employees into teams to develop ideas that can beat Bosch itself, and the selected teams are freed from daily tasks for eight weeks to focus on that work. Such innovative entrepreneurship stabilizes labor relations and enhances competitiveness in securing skilled personnel. The MZ generation desires the establishment of a virtuous cycle of high wages and high productivity through organizational and human capital innovation aligned with technological innovation.

The formation of MZ generation unions is a result of high unemployment, inequality, and technological and industrial transitions. The government shows little interest in this issue. However, if neglected, alongside union growth, IT service companies that are just beginning to bloom will wither like the declining manufacturing sector. Korea’s labor-related laws are centered on factory labor and do not fit current realities, and education focuses on memorization and exams. Universities, under government control, fail to train skilled personnel, worsening youth unemployment. Welfare policies such as public jobs and youth allowances have prolonged unemployment, trapping the MZ generation in a quagmire of low growth and high unemployment. Policy innovation to increase labor market dynamism is necessary to prevent labor relations and employment instability that MZ generation union formation may cause.

Kim Taegi, Professor Emeritus, Department of Economics, Dankook University

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