POSCO's 48-hour strike no impact, large message

The 'partial' 48-hour strike by union members at South Korea's largest steel company, POSCO, that began at 7 a.m. on September 9, is having zero impact on steel production, the company says. But the strike, POSCO's first since its founding in 1968, has garnered huge publicity both in Korea and abroad and might give company management cause to pause.

So far as strikes in Korean heavy industry go – those at shipbuilder Hyundai Heavy Industries are notorious for their size, duration and sometimes violence – that at POSCO is a mere hiccup.

About 10,100 employees company-wide belong to POSCO's labour union, affiliated with the Korean Metal Workers' Union. Of these, only about 120 members - just over 1% - are participating in the strike. About 20 are from the No. 2 electrical steel plant at its Pohang works and 100 from the pickling lines at its Gwangyang works. POSCO has arranged for other workers to step in to keep the lines operating.

At its core, the strike is about salary and conditions. At its latest negotiations with management that ended in rupture on September 3, the union had reportedly demanded a 7.1% increase in base pay, a performance bonus equivalent to 600% of monthly wages, 50 POSCO shares for each member, and a holiday bonus equivalent to 200% of monthly wages.

In response, management offered a 2% increase in base pay, a KRW 3.5 million ($2,600) performance bonus and KRW 500,000 in Iocal gift cards. The company argued that accepting the union's demands would cost about KRW 1.4 trillion – equivalent to about 80% of its profit last year – at a time when business conditions are tough and costs are soaring.

POSCO's operating profit in the first half of this year plunged 43.3% from a year earlier to KRW 487.3 billion, amid the prolonged steel-market downturn driven by oversupply from China and sluggish domestic demand. During 2025, the operating profit of its steel division alone reached just KRW 1.8 trillion, lower by nearly 75% from 2021.

But Korean industry watchers suggest the dispute is not simply about higher wages but is a flashpoint for other issues including staff shortages, long working hours and employee welfare.

"The POSCO Group is currently expanding into new businesses such as secondary battery materials and liquefied natural gas. However, while steel remains its mainstay, efforts to secure overseas production bases in the U.S., India, and Indonesia have yet to yield results significant enough to offset declining performance," local daily, Chosun Ilbo observed. "Some view the strike as a result of POSCO hitting structural limits," it added.

The strike is taking place just a week after POSCO joined the groundbreaking for a new automotive sheet works in Louisiana in the southern United States being actioned by Hyundai Steel-POSCO Louisiana Steel LLC (HPLS) joint venture, as Mysteel Global reported. POSCO holds 20% of HPLS and will be reportedly allocating about $580 million for its share of the new plant's necessary investment.

Moreover, the walk-off began in Korea just over 48 hours after POSCO management and assorted other dignitaries celebrated the start of construction on Tuesday of a new 450,000 tonnes/year hot-dip galvanizing line at the Gwangyang works that will cost KRW 480 billion, also as reported.

"(POSCO) employees, meanwhile, express anxiety as the company's performance has plummeted in recent years," Chosun Ilbo noted. "There are growing concerns that management's focus on investment and growth in new businesses and overseas markets will lead to neglect of domestic operations (and) a sense of deprivation has also grown as they observe other industries," it said.

The union has said that if the first partial strike doesn't lead the company to change its stance, it will organize a second, longer strike lasting 120 hours from September 16.

Written by Russ McCulloch, russ.mcculloch@mysteel.com

Edited by Alyssa Ren, rentingting@mysteel.com