Illustrative of both the dramatic restructuring in the sector as well as the increased use of robots, statistics from South Korea show that the number of shipbuilding employees will have halved from its 2015 figure of 200,000 by the end of this year.
According to the Korea Offshore and Shipbuilding Association, the number of shipbuilding workers was more than 200,000 in 2015, was 130,000 last year and will be less than 100,000 this year.
Moreover, the level of experienced workers has seen a sharp drop – those with more than 10 years experience at a shipyard are now increasingly rare.
According to Clarksons, South Korea’s market share, based on order volume, in the world shipbuilding market was 27.7% last year, with China on 39.5% and Japan at 8.6%.
South Korea is following in the footsteps of Japan where subcontractors have become vital to fill the skills gap. In the 1990s, subcontractors accounted for 20% of the total workforce at a Korean yard, a figure than now stands at around 70%.
The downsizing of South Korean yards has also come at a time of significant automation whereby now the nation boasts more robots in heavy industry per human worker than anywhere else on earth with many shipbuilding processes now carried out by machines.
Meanwhile, the head of the Export-Import Bank of Korea (Eximbank) said yesterday the export credit agency will continue pushing ahead with its plans to further restructure the ailing shipbuilding and shipping industries.
CEO Eun Sung-soo said the bank is talking with the Korea Development Bank (KDB) about a possible merger between Sungdong Shipbuilding and Marine Engineering and STX Offshore and Shipbuilding.