"People with Lower Qualifications Get Paid More"… The 2030 Generation's Anger Over Seniority-Based Pay [T Like F]
Dissatisfaction among the 2030 generation is growing over the seniority-based pay system (ho-bong-je), where wages increase with longer tenure. An analysis suggests that a structure where those who have been around longer earn more than those with better performance or practical skills reduces labor market flexibility and intensifies feelings of deprivation among young people.
Reporter Kim Ji-young of this newspaper and Dr. Son Yun-hee appeared on the YouTube channel EToday TV's "T Like F" (directed by Kim Sung-hyun) to examine the intergenerational conflict and structural issues surrounding the wage system. They took as their starting point the stark contrast between the employment environment before the IMF and today.
Reporter Kim said, "In the past, just graduating from university meant companies would line up to hire you, and you could even choose where to go. Now, the 2030 generation has much higher qualifications but nowhere to go." She added, "Young people feel a great sense of unfairness seeing someone who seems to have put in less effort and has lower qualifications receiving a higher salary higher up."
Dr. Son pointed to the seniority-based pay system as the structural background of this discontent. "The lack of flexibility is ultimately due to the seniority-based pay system," she said. "Even those with lower abilities take up a significant portion of wages just by staying in their positions." She diagnosed, "This rigidity leaves no room to give more to lower-level employees and blocks opportunities to create more value, breaking the virtuous cycle in the labor market."
However, both agreed that this issue is a dilemma that cannot be resolved by blaming one side. Reporter Kim said, "Those who are now receiving high salaries also endured low pay when they were young. It's hard to ask them to accept a pay cut." Dr. Son added, "There is backlash from those who say, 'We endured low starting salaries and are just starting to earn properly—why should we be the only ones to suffer when those below us complain?'"
The core of the generational gap in perception was the disappearance of the concept of a "lifetime job." Reporter Kim said, "The idea of a lifetime job is gone. Young people who can leave at any time want to earn a lot now rather than wait for higher pay after 20 years." Dr. Son highlighted, "Given the crisis that young people feel, they can't stay at a company looking forward to a higher pay grade 20 years down the line."
Differences in perspective on the productivity of new employees were also discussed. Reporter Kim said, "New employees often have negative productivity initially, and training them costs money. Having good qualifications is separate from actual productivity."
The wage gap between large corporations and SMEs was also a major topic. When Dr. Son mentioned the significant difference in wage structures between the two groups, Reporter Kim attributed it to the subcontracting structure. She explained, "Large corporations negotiate wages with unions, but most SMEs are subcontractors, so they have to set labor costs within the supply price set by the primary contractor. This fundamental difference causes the gap to keep widening." Dr. Son said, "Inevitably, people flock to large corporations where wages are fixed and stable."
Rising expectations also fuel dissatisfaction. Dr. Son said, "What people want has increased, but wage levels haven't kept up. People have come to expect a life that goes beyond saving and scrimping."
A gradual transition was proposed as a solution. Reporter Kim suggested, "It's difficult to change the seniority-based pay system right now. To avoid disadvantaging current employees, we need to gradually shift the wage system for new hires toward job-based and performance-based pay." The video also mentioned a long-term alternative of transitioning over about 30 years.
The two agreed that this issue should be elevated from individual salary complaints to a social agenda. Dr. Son said, "People's thoughts and lifestyles have all changed, but the wage system has been fixed for decades." Reporter Kim concluded, "We need to have a serious discussion at least once about whether the current structure, where lifetime income is determined at the point of entry into the workforce, is reasonable."
▲ Screenshot from 'T Like F.' (EToday TV)
