Saemaul Undong Archives : A Workplace Geumgo that Triggered Factory Saemaul Undong

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A Workplace Geumgo that Triggered Factory Saemaul Undong

“A Red Ant of Incheon Harbor”, Mr. Son Kwan-Hyung

Workplace Geumgo of Incheon Steel Began with 30,000 Korean Won

In 1968, Workplace Geumgo was constructed in Incheon Steel, which was the precursor of Hyundai Steel. A small geumgo which started with only 30,000 won with a few employees grew to one holding 123 million won, with 2000 employees joined. After depositing the money in the bank, they received a dividend of 20% of the deposit. The dividend was allocated to the workers at the end of the year, and a loan was available whenever a lump sum of money was needed, such as for tuition or marriage funds.

A fruitful result of workplace geumgo led to Factory Saemaul Undong in 1976. Through a Goods Saving Campaign carried out by members, 2-billion-won was saved that year, and quality improvement and efficient production management became possible through the enthusiastic debates of 76 discussion groups by allocated tasks. Session discussions made everyone share their opinions. It worked as a school of democracy and a cornerstone of cooperation between laborers and authorities. This innovation was started by a single employee.

공장 새마을운동으로 만성 적자를 탈피한 인천 제철(새마을 화보, 1976년)

"Our colleagues are leaving. Haven’t we spent time with each other as if we were brothers? Shouldn’t we help them if we have a sense of duty?”

"Let’s stop drinking and smoking to save money and collect it."

"Okay, I’ll try."

One day in 1970,

Son Kwan Hyung, who had been working for 10 years in the company, gathered several colleagues to install a Workplace Geumgo - to help those who suffered from debt.

The workers' welfare system was unstable at that time. Employees got a paycheck regularly, but when there was a special occasion in their family, they had no choice but to ask for help from a loan shark. Actually, many of them were harassed with debts and resigned work in order to get a severance pay to clear off debts. Mr. Son and his colleagues immediately built a workplace geumgo with 30,000 won in cash they got there.

"This is not bearable anymore. Fire him immediately."

"I afraid I can’t. There will be a huge chaos since the big amount of money has already been loaned."

"If so, make him close the workplace geumgo."

Colleagues were suspicious of Son signing up people for the association.

“What is he going to do with a fortune? Wouldn’t he just dine and dash?”

“How can we believe that our money will be secure?”

“How much did Son’s house cost?”

In fact, there was a reason why he was so eager to establish a geumgo – it was because of his son’s death. His son got pneumonia but he couldn’t give him medical treatment since he had no money. Not wishing that painful thing to ever happen again, he steadily saved money. As the number of those who benefited from Workplace Geumgo grew, the member of the association increased to 600. The company was flustered. If an accident occurs at a credit union established by employees themselves, who will take responsibility? The company ordered the Workplace Geumgo to be closed.

The Scene of People Saving to Geumgo in Incheon Steel (Saemaul Illustration Books, 1976)

“Send 300 executives to Saemaul Training Institute!”

“Let’s make trainers consist of 8 executives and people who finished Saemaul Education, and assign 228 discussion group leaders as a first stage.”

Factory Saemaul Undong in 1976 saved a Workplace Geumgo from the threat of liquidation. After attending the Saemaul Leadership Training Center, the attitude of the managers, who prioritized the company, changed. Even the Incheon Steel President and all 300 executives came to Saemaul Leadership Training Center to receive an education. As a result, there was a startling change in the company. How did the Workplace Geumgo and Factory Saemaul Undong form a win-win relationship? How did the Workplace Geumgo survive? How has the welfare of Incheon workers improved?