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South Korea Faces More Strikes as Rail Workers Return to Jobs

South Korea is confronting another wave of labor unrest, a day after South Korean rail workers voted to end their four-day strike. The brewing conflict could further undermine foreign investor's confidence in South Korea's economy.

South Korean President Roh Moo-Hyun vowed this week to take a hard line on labor unrest and his tough talk appeared to bear fruit. On Tuesday, railway workers voted to head back to work, ending a strike that had crippled much of South Korea's transportation network.

But on Wednesday, at least 90,000 trade unionists put down their tools in a four-hour partial work stoppage. The Korean Confederation of Trade Workers are demanding better working conditions and higher pay.

Nearly 30,000 Hyundai Motor workers, South Korea's largest automaker and a mainstay of its export-driven economy, led the walkout. Many investors cite union inflexibility as a big problem for business in South Korea.

Most financial analysts have trimmed projections for South Korea's third-quarter growth. Domestic spending has dropped and foreign investors remain skittish about the North Korean nuclear crisis and the fresh round of labor unrest.

"This is really a major headache for the Korean economy right now, because not only domestic investors but also the foreign investors do not feel comfortable about Korean industry," said K.H. Shim, a financial analyst with Atlantis Investment Management in South Korea. "Lots of foreigners just wait and see what is the final result of this labor unrest."

But Mr. Shim added that he believes the strikers are beginning to lose favor with the general public and will consequently lose some of their political power.

President Roh, a former labor lawyer, won office four months ago, largely due to backing from the unions.

But his tough stand against the railway strikers seems to have put an end to their era of mutual support, with union leaders saying they may vote against his ruling party in next year's elections.