"Corporate Citizen" POSCO, No Workforce Restructuring Planned

[Asia Economy Reporters So-yeon Park, Yoon-joo Hwang] According to the steel industry on the 9th, POSCO recently decided to adjust the operation timing of the Gwangyang No.3 blast furnace, which has just completed repairs, and to implement flexible operations, including halting some production facilities starting from the 16th.

Employees at the facilities where production stops will engage in training or maintenance activities. For workplaces where equipment is stopped for more than three days, paid leave is implemented according to the Labor Standards Act. POSCO plans to pay 70% of the average wage during the paid leave period. This is the first time since POSCO's establishment in 1968 that paid leave has been implemented. Although POSCO has not disclosed which production lines will be halted, the industry expects that cold rolling and plating facilities supplying the automobile and home appliance sectors, which have seen a sharp drop in demand due to the COVID-19 crisis, will be affected.

The steel industry is facing significant difficulties due to the COVID-19-induced economic downturn in the automobile, shipbuilding, and construction industries, which are major consumers of steel products. Recently, raw material prices have surged, with global iron ore prices surpassing $100 per ton, creating a structure where producing more steel products results in losses. Accordingly, not only POSCO but also Nippon Steel is conducting unpaid leave twice a month until March next year, and most global steelmakers are reducing production. Earlier, Hyundai Steel also stopped operations at the electric furnace hot rolling mill at the Dangjin Steelworks starting this month.

Within the industry, POSCO’s decision to implement a cyclical paid leave system instead of restructuring is interpreted as a decision supported by its management philosophy of 'Corporate Citizenship.' A senior POSCO official stated, "Even in the deepest valleys, as a 'Corporate Citizen' pursuing the values of coexistence and symbiosis, POSCO must fulfill its role," emphasizing, "No matter how difficult the current economy is, there will be no workforce restructuring."

To overcome the difficulties caused by the prolonged COVID-19 crisis together, POSCO has declared no restructuring within the group and reduced rental fees for its facilities externally. By lowering rents for 135 stores, POSCO shared the burden with small business owners and strengthened its role as a 'Corporate Citizen.'

'Corporate Citizenship' is a concept first introduced by POSCO Chairman Chey Jong-woo in his inaugural speech two years ago. It goes beyond the belief of 'steel for national prosperity,' which contributes to the national economy by producing good steel, to mean that the POSCO Group itself must become a member of society pursuing not only economic profits but also the values of coexistence and symbiosis.

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