"Remote Control Technology Only in Pilot Stage"... Construction Industry Hesitates on Innovative Technologies Amid Downturn

Union Issues Strong Statement Against Remote-Controlled Tower Crane

Declining Productivity in Construction Sector Highlights Need for Smart Technologies

Labor Disputes Expected over Employment Concerns...Dilemma between Yellow Envelope Act a

A tower crane operator is operating a tower crane from a remote control room developed by Hyundai Engineering & Construction. Hyundai Engineering & Construction

#Hyundai Engineering & Construction introduced the nation’s first remote-controlled tower crane at a construction site in Gwacheon, Gyeonggi Province, at the end of January. Although the tower crane is essential equipment at construction sites, operating it requires workers to climb ladders and work at heights, which presents significant risks. Hyundai Engineering & Construction has enabled operations from a safe ground-based control room through remote control technology. However, the company remains cautious regarding concrete expansion plans. A company representative stated, "We will operate the remote-controlled tower crane until the end of July this year, and after reflecting on the results, we will decide whether to expand its use and establish further plans." Nevertheless, industry insiders believe that, given the traditionally strong labor unions in construction, scaling up will not be easy.

The construction industry, currently in a downturn, is hesitant to adopt new technologies. While there is agreement on the need for innovation to improve safety and reduce costs, the reality is more complex. Industry sources point out that the so-called "Yellow Envelope Act" (amendments to Articles 2 and 3 of the Trade Union and Labor Relations Adjustment Act) is making it even harder to introduce new technologies. Because the scope of labor disputes has expanded to include "business management decisions affecting working conditions," companies feel increased pressure regarding broader technology adoption. On the other hand, if construction firms delay innovation, they risk infringing on shareholder interests under the revised Commercial Act implemented last year, deepening their dilemma.

According to the construction industry as of March 17, the crane introduced by Hyundai Engineering & Construction at the "The H Adelstar" site in Juam-dong, Gwacheon, can be operated from a remote control room on the ground, with nine cameras installed to monitor the entire work radius. Key safety information, such as wind speed and a tower crane collision prevention system, is also provided. Above all, since operators do not need to enter high-altitude or high-risk work zones, the system offers significant safety advantages.

Hyundai Engineering & Construction’s reluctance to expand appears to stem from the inability to ignore union opposition to smart construction technology adoption. The Korea Tower Crane Operators’ Union, affiliated with the Federation of Korean Trade Unions (FKTU), stated in a press release, "This destroys the ecosystem of construction sites and systematizes cost reduction for profit preservation," calling for withdrawal of the initiative. The Korean Construction Workers’ Union, affiliated with the Korean Confederation of Trade Unions (KCTU), also issued a statement opposing the move, suggesting instead that elevators be installed on tower cranes.

Union opposition is attributed to concerns that further automation could raise issues of technological safety and negatively impact employment. Hyundai Engineering & Construction maintains that the remote control technology it has introduced is not aimed at unmanned operations and, therefore, is not directly related to employment. In principle, each remote-controlled tower crane is operated by one operator. However, from a technical standpoint, multiple cranes could be connected and managed. For this reason, unions are concerned that future technological advances could lead to unmanned operations or workforce reductions. The Korea Tower Crane Operators’ Union under the FKTU stated, "If (unmanned operation) threatens our right to work, we will consider disputes or legal action against the company."

Tower crane operators, depending on experience and other factors, earn a monthly salary of at least 5 million won. Including additional allowances, monthly pay can reach 10 million won. There are also unofficial monthly payments made on-site in addition to salaries. Remote operation can help reduce these costs.

Hyundai Engineering & Construction is not alone in this. In November last year, POSCO E&C succeeded in pilot-testing a remote-controlled excavator for the first time in Korea, but commercialization has yet to be decided. If adopted on-site, conflict with unions cannot be ruled out.

Cost savings from new technology adoption are also tied to the revised Commercial Act, which strengthens the duty of loyalty to shareholders, requiring companies to maximize profits. With the enforcement of the Yellow Envelope Act, there are concerns about facing a dilemma between union and shareholder interests.

Hwang Yong-sik, professor at Sejong University’s School of Business, stated, "If the Yellow Envelope Act causes additional costs for companies, claims of shareholder value infringement may arise," adding, "From an individual point of view, legislative action may be justified, but in the broader context, this is a case of conflict."

Nevertheless, industry experts believe that, considering low productivity, adopting smart technologies is becoming an inevitable trend. POSCO E&C, in partnership with robotics company Clobot, has introduced autonomous cleaning robots that use pre-learned spatial information and travel paths for post-construction cleaning at the Sinbanpo 21st Apartment reconstruction site in Seocho-gu, Seoul. Samsung C&T has also unveiled AI-based smart construction technologies such as autonomous forklifts, material transport robots, cleaning robots, and water-spraying drones.

According to the Korea Productivity Center, the construction industry’s labor productivity index for the third quarter of last year, based on industrial output, was 78.7. This represents a 9.2% decline compared to the previous quarter’s 86.7. The index, with 2020 as the base year at 100, reflects the relationship between input factors such as labor and resulting output volume. The index rose to 88.4 in 2022 and 99.2 in 2023, but has since declined again. The aging workforce and increasing reliance on foreign labor in the construction industry are cited as factors behind declining productivity.

Meanwhile, labor costs continue to rise. Data from the Construction Association of Korea shows that the average daily wage for all construction job categories (for an 8-hour day) in the first quarter of this year reached 279,988 won, an increase over previous years. Compared to 242,931 won in the first quarter of 2022, this represents a 15.2% increase over four years.

According to a report from Samil PwC Management Research Institute titled "Construction of Tomorrow: Strategies for Sustainable Growth in the Construction Industry," the domestic construction sector is now entering a period of decline, and the institute recommends expanding business diversification and the use of smart construction. The report explains, "Automated processes and data management can help save unnecessary labor and costs," and "Shortening the construction period can enhance process efficiency and reduce costs."

With global big tech companies making progress in robotics, smart construction—including unmanned operations—is becoming a reality. U.S.-based heavy equipment manufacturer Caterpillar is working with Nvidia to introduce automated construction equipment equipped with AI assistant systems for medium-sized excavators. Domestically, Doosan Bobcat is accelerating its transition to physical AI by unveiling AI-based voice control technology that can execute over 50 functions, such as equipment setup, through voice commands.

An industry official stated, "If unmanned construction machinery becomes commercialized, the likelihood of employment issues arising is very high," adding, "Which technology to adopt is ultimately the user’s decision, but the difference in positions with the unions could become a major social issue."

Experts advise that labor and management should work to bridge the gap between the Commercial Act and the Yellow Envelope Act. Jin Kyungho, Director of Construction Policy Research at the Korea Institute of Civil Engineering and Building Technology, said, "Union concerns are understandable, as smart construction could be linked to job loss," but added, "As automation or unmanned operations progress, workers’ roles will shift toward management and other tasks, so companies and unions could minimize conflict by negotiating and adjusting these roles."

Professor Hwang explained, "To minimize fallout from clashes between the Yellow Envelope Act and the Commercial Act, rather than implementing piecemeal measures, it is necessary to adopt a comprehensive perspective, listen to diverse stakeholders, and set the agenda accordingly." He added, "The current government should consider forming an organization to examine where and why conflicts arise under the Commercial Act, which was proposed and enacted during this administration."

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