It is now a consensus view that the main cause of the Korean financial crisis of 1997 was a lack of market discipline and the malfunctioning of the Korean market system rather than macroeconomic imbalances. The internal and external economic situation looks gloomy, and the evidence is everywhere. Oil prices remain high. Collective attempts by unions to pursue their own interests are prevalent. Restructuring and seasonal factors are casting a shadow on the employment prospect.
Conflicts surrounding mergers in the financial sector between labor and management continue.
The ongoing reform at banks and businesses is expected to result in an additional 75,000 jobless. The number of unemployed, which recorded around 800,000 at the end of October, is likely to increase to almost 1 million next spring even by the most modest estimates.