"Focus on Housing Market Promises... Please Also Revive the Construction Industry"

Construction Industry Accounts for 15.2% of GDP

Apartments in downtown Seoul as seen from Namsan, Seoul

As the presidential election concluded and the housing market began to stir with expectations of deregulation, calls from the industry for policies to foster the construction sector are growing louder. President-elect Yoon Seok-yeol's pledges have been primarily focused on the housing market, leading to criticism that strategies for the development of the construction industry have been relatively neglected. Consequently, voices are emerging that emphasize the need to promote industrial development policies, including improvements to safety regulations centered on punishment, starting from the operation phase of the Presidential Transition Committee.

According to the construction industry on the 14th, the construction sector accounted for 15.2% of the Gross Domestic Product (GDP) as of 2020. As of December last year, the number of workers in the construction industry was 2,109,000, ranking fourth among major industries in terms of employment size. Despite the significant ripple effects the construction industry has on the national economy, construction industry policies were relatively overlooked during the presidential election period. President-elect Yoon’s election pledge book, "A New Republic of Korea Built on Fairness and Common Sense," contains 44 national tasks and 207 pledges. However, the only content related to the construction industry is the commitment to "eradicate poor construction and create safe construction sites."

In contrast, previous administrations had numerous pledges related to the construction sector that were actually implemented on the ground. Examples include the Roh Moo-hyun administration’s expansion of the lowest bid system application, the Lee Myung-bak administration’s construction regulation improvements, the Park Geun-hye administration’s abolition of the lowest bid system, and the Moon Jae-in administration’s expansion of the direct payment system by the ordering party. Jeon Young-jun, a research fellow at the Construction Industry Research Institute, suggested, "It is necessary to actively reflect construction industry policies when identifying national tasks during the transition committee and the early stages of the new government." He mentioned the need to improve outdated laws and systems unsuitable for changes in industrial structure and to boldly reform punishment-centered regulations.

Especially since the new government emphasizes the value of "integration," there is also an assessment that good proposals from losing candidates’ pledges should be actively utilized. For example, candidate Ahn Cheol-soo proposed raising the minimum bid rate for public construction projects subject to qualification review and negotiated contracts. An industry insider said, "For small and medium specialized construction companies, they end up winning contracts at amounts lower than the actual construction costs and have no choice but to squeeze the project sites to make up for it."

There are also demands to revise laws such as the Serious Accidents Punishment Act, which show a gap between ideals and reality. The Korea Federation of Construction Associations appealed on the 10th, calling for "the relaxation of various regulations that produce only punishment and outdated laws and systems that do not fit the changing industrial structure." A representative of a specialized construction company said, "We want to do our best to prevent accidents but ask that punishment regulations be adjusted to a reasonable level." There is also strong caution regarding the enactment of the Construction Safety Special Act being promoted in the National Assembly. The act aims to legally assign safety management responsibilities to ordering parties, designers, constructors, and supervisors, and impose criminal liability for violations. However, the construction industry opposes it, arguing that the Construction Safety Special Act overlaps with the Industrial Safety and Health Act and that it is excessive legislation given the enforcement of the Serious Accidents Punishment Act.

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