The North Korean authorities have increased the wages of laborers 100 times in main factories, such as the Sung Jin Steel Manufacturing Plant, the Kim Chaek Iron and Steel Complex, the Musan Mine, and other locations since last September. Wages of other medium or small sized factories has increased 10 times. For the most part, it is believed that this increase in wages will influence inflation in the market. However, it is well known that as wages are paid in commodities rather than money, the atmosphere of the market greatly shrinks.

 

Open Radio for North Korea’s source in North Hamkyung Province said on the 4th, “More than half of wages that are paid to laborers are paid using necessities, including food, instead of money. Most of these necessities are sweet rice, soybean oil, sugar, meat, clothing, and home electronics. There are mostly Chinese products.”

 

The source explained, “Since people receive goods as wages, the buying rate in the market decreases, while the amount of people selling those goods, which they receive as wages, in the market increases. As a result, the price of main products in the market is decreasing rapidly.”

 

The source also explained that as the North Korean authorities raised laborers’ wages 100 times, laborers, who used to receive 3,000 won, are currently receiving 300,000 won for over two months. This brought a positive reaction from the laborers.

 

North Korea experienced bitter consequences from the ‘7.1 Measure’ in 2002, when they raised laborers’ wages more than 18 times, causing the price of all goods to increase.

 

The measure this time has been analyzed as the North Korean authorities’ intention to block inflation, by giving commodities, rather than money, as laborers’ wages.

 

The source said, “Since the authorities give commodities as wages instead of money, inflation doesn’t happen, but it strikes a heavy blow to merchants. People are worrying regardless of whether they are being paid with money or with commodities.” 

 

Source: Open Radio for North Korea