Durable Gender Inequality in the Growing Low-Wage Service Economy in Korea

This study looks into recent labor market changes in the rapidly growing service economy in South Korea and its implications for gender inequality. In trying to explain increasingly widespread low wage jobs for women in the contemporary labor markets and the persisted gender inequality, this article relies upon the concept of ‘durable inequality’ suggested by Charles Tilly (1998) and identifies the factors that reinforce gender inequality in the structural changes of the economy.

Despite its general success in industrialization, economic development and democratization over the past half century, Korea has generally fail to integrate women into the labor markets. According to the latest Global Gender Gap Index 2015 by World Economic Forum, Korea has lagged far behind many industrialized countries in economic participation and opportunity. It ranked 116^thout of 145 countries in wage equality for similar work. In addition, the female to male ratio of legislators, senior officials and managers was only 12 percent which implies the women’s career disruption due to family duties as well as the perpetuated gender discrimination that prohibits women from advancing their career to the senior positions within an organization.

The on-going structural changes in the economy after two major financial crisis in 1997-8 and 2008 that now explains 70 percent of workforce working in service industries do not appear to contribute to improving the women’s labor market conditions. The situation is rather opposite despite increasing inequality within each gender category. The country’s post-crisis economy has created extensively low wage services where women are increasingly overrepresented, which consolidates gender inequality.

To explain this perpetuated gender inequality in the tertiarization of the economy, we borrow Tilly’s concept of durable inequality and focus on the relational process in which gender inequality has enhanced over time by the combination of organizational boundaries and the categorical distinction in which social norms are embedded. Focusing on the role that employers have played, we discuss how a firm’s structure and policies have influenced the process of durable inequality. Specifically, we explain the interactive mechanism through which the unequal labor conditions and disadvantaged status of women service workers are sustained and fortified by the intersection of firm practices and the hierarchical social category of gender. Those firm practices include: 1. human resource practices that create and consolidate both explicitly and implicitly gendered dual career paths, 2. vertical disintegration of large firms and their hierarchical control over the production network: the gender segregation is not limited to the firm boundary but extended to the hierarchically networked firm structure, 3. the customer service strategies based on ‘customer sovereignty’ that creates and strengthens the feudality of customer relations that has strong gender implications. Using three occupational case studies of non-managerial office and administrative support workers, call center service representatives, and retail sales workers, we will show how these three mechanisms have enhanced gender inequality in increasing low-wage services in Korea.