Facing Up To Reality
The economy is sick. The old security is gone. But the hardships are forcing South Koreans to learn how to thrive in a competitive world
By DONALD MACINTYRE Seoul

After five years as a construction site manager at Samsung, Chung Hwan Oak was more used to giving orders than taking them. So making sales calls for his new catering business turned out to be particularly hard on his pride. After bowing deeply, Chung, 49, would pitch his hot-pot lunches--steaming vegetables seasoned with shrimps and fiery pepper sauce--then explain how he'd lost his job at the giant conglomerate. Often people just slammed the door in his face. Those who listened didn't offer him a chair. The frosty treatment stung, but Chung knew what was behind it. In status-conscious Korea, Samsung is at the top of the job heap--catering is near the bottom. "Running a restaurant wasn't a respectable thing to do," says Chung. "The hardest part of shifting gears was pride."

That was a year ago. Today customers are flocking to Chung as word of his tasty food spreads. Friends who once scoffed at his restaurant plans want advice on how to set up their own catering joints. The definition of what's respectable in South Korea has changed fast since economic collapse punched a hole in the Korean Dream. When the country was vaulting to economic success, parents aspired to get their sons into white-collar jobs at giant chaebol, or conglomerates, like Samsung. A year of life under the yoke of a humiliating $58 billion bailout from the International Monetary Fund has crushed all that. A bright horizon of lifetime jobs and seemingly nonstop growth has suddenly dimmed. In its place: soaring unemployment, a more competitive role in the global economy and diminished expectations for a country that had been living beyond its means.

Now, a generation that grew up taking rising living standards for granted is throwing the old model out the window. Out-of-work managers are rolling up their sleeves and starting their own businesses. Some are going back to the farm, reversing the path trodden by an earlier generation as industrialization took off. After watching scores of big companies go under, university graduates are heading off in new directions as well. A job at a big chaebol is no longer seen as a ticket to the good life. Young Koreans are picking smaller, healthier companies, where they have more chance to make a mark. A new pragmatism is replacing the old emphasis on size, prestige and face, says Kim Nong Ju, a career counselor at Yonsei University in Seoul. "It's a tremendous change. Koreans used to want to wear the pin of a big business group because that is what their fiancee's parents would look at."

The pressure to adapt is only going to increase. Korea's economy may be sputtering back to life, but unemployment is expected to hit a record high of 9% this year. A fragile detente with labor is unravelling, threatening to slow the whirlwind of reforms President Kim Dae Jung set in motion in his first year in office. A radical labor union marched through the streets of Seoul on Feb.27, demanding a halt to layoffs. But even Korea's notoriously feisty unions recognize that the old culture of job security is gone. The country's worst recession in nearly half a century is already forging an economy that will be more flexible and competitive. "Korean society was headed in the wrong direction," says Kim Hyoung Hwan, who started his own shoe-repair business last year after losing his job. "This is a healthy correction."

In the old Korea, wearing the pin of a top chaebol conveyed prestige, improved marriage prospects, even promised better treatment at government offices. Graduates of the best universities--Seoul National and Yonsei--aimed for the top five chaebol: Hyundai, Samsung, Daewoo, LG and SK. Those who didn't make the cut tried for the next rung down. Getting a son into a big concern, or an important ministry, won bragging rights for parents. Family pressure often weighed more heavily in career choices than personal inclination.

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