Government "Seeking Solutions to Construction Cost Increase... Taeyoung Construction Wage Arrears to be Resolved Before Lunar New Year"

'Construction Industry Vitality Recovery Meeting'
Government Listens to Construction Sector Difficulties

On the 6th, Park Sang-woo, Minister of Land, Infrastructure and Transport, stated, "We will find productive solutions regarding the rise in construction costs."

Minister of Land, Infrastructure and Transport Park Sang-woo is speaking at the "Meeting for Revitalizing the Construction Industry" held on the afternoon of the 6th at the Construction Hall in Nonhyeon-dong, Gangnam-gu, Seoul. / Photo by Ministry of Land, Infrastructure and Transport

After the 'Meeting for Revitalizing the Construction Industry' held at the Construction Hall in Nonhyeon-dong, Gangnam-gu, Seoul, Minister Park said in a briefing, "The issue of rising construction costs involves various complex factors such as contracts, so we will observe it over time."

He added, "One of the difficulties faced by the construction industry was the increase in construction costs due to rising prices, raw material costs, and labor costs. We acknowledge the unavoidable reality of rising construction costs and will review measures to secure appropriate construction costs for projects that have started or are under contract." This revealed the government's intention to rationalize construction cost estimation.

The meeting was arranged as a follow-up to the housing sector public discussion chaired by the President on the 10th of last month. Minister Park, Minister Lee Jeong-sik of the Ministry of Employment and Labor, and Chairman Kim Joo-hyun of the Financial Services Commission attended, listening to difficulties from construction associations such as the Korea Construction Association, the Korea Specialty Contractors Association, and the Korea Mechanical Equipment Association. The industry conveyed concerns about rising construction costs, liquidity support, and issues related to the Serious Accidents Punishment Act.

Regarding the Serious Accidents Punishment Act, concerns about judicial risks were raised. Minister Lee said, "There were comments that small and micro enterprises face employment instability for workers if the owner is punished and the business closes. We will advance solutions through inter-ministerial cooperation and institutional improvements to address structural problems."

Meanwhile, the government expects the wage arrears issue at Taeyoung Construction to be resolved before the Lunar New Year holiday. Minister Lee stated, "There are about 6.55 billion KRW in unpaid wages for approximately 2,500 workers from 22 subcontractors across 11 sites. Relevant ministries will cooperate to resolve all before the holiday." The Seoul Sangbong-dong site of Taeyoung Construction cleared 1 billion KRW in unpaid wages and resumed construction on the 27th of last month. The Daegu Sincheon-dong site also restarted construction on the 29th of last month.

Wage arrears in the construction industry surged by 49.2% year-on-year to 436.3 billion KRW last year. Considering that construction workers accounted for 7.8% of total employed persons as of December last year, the proportion of wage arrears in the construction industry is high at 24.4%. Minister Lee said, "We have improved the system so that companies can receive low-interest loans to pay wages directly and will strengthen it further. We will make it difficult to operate a business in Korea if wages are withheld."

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