South Korean shipyard workers today proceeded with their four hour walk-out, the first of its kind at a South Korean shipyard.
5,400 men of the workforce, all members of a 'labour council' (Samsung does not permit official unions) downed tools in anger at the planned restructuring of the company's yard which will see lay-offs and rationalisation as the company seeks to balance its books amid a dwindling order book and financial problems which have beset all three of the country's biggest shipbuilding concerns, as well as the wider South Korean shipbuilding industry.
The strike is unprecedented and has encouraged others to follow suit. Workers at Hyundai Heavy Industries yards have are also to meet to vote on strike action next week whilst those at Daewoo have already agreed to strike.
The effects of such a relatively small reduction in labour may not be too great, but the psychological ones are. South Korean workers have largely been viewed as compliant and willing employees, but this action proves that they will not take efforts to reduce their numbers easily.
The company had proposed an early retirement package but the council views this as nothing more than redundancy and opposes the measure vigorously.
The Big Three, Samsung, Daewoo, and HHI have gone from the world's largest shipbuilders with record-breaking order-books to the most indebted and struggling of concerns over the past few years.
The crash of 2008 did not help but competition from China is seen as the main reason for their woes. Asian shipbuilders in general have cut prices and finance in Asia has not been hard to obtain, resulting in an oversupply of ships on the sea as well as now an oversupply of shipbuilding yards.
With China slowing down its breakneck growth and the emphasis now on internal markets to service its growing aspirational population, shipping is experiencing a downturn. Troubles now in Europe only add to the problems of filling order-books and mounting debts at shipbuilders across the region can only be fixed when the orders become profitable again.
The likelihood is that Chinese yards, who have suffered too, are going to aggressively push cheaper newbuilds onto the market, if so, this will only worsen an already unsustainable situation.
South Korea is now embarking on a programme to reduce its exposure to shipbuilding, with the potential of 60,000 jobs being lost. Smaller and medium sized Korean yards are being assisted to offload their employees and indeed close or merge. The Big Three have not been offered the same assistance but rather left to deal with their problems as they see fit.
Shipping Times recently likened the situation as a Battle of the Giants, and now the battle seems to have become one between the giants and the workers.