North Korean authorities have renewed efforts to crack down on a workplace exemption scheme called “8.3 Earnings” that allows workers to engage in private business activities, Daily NK has learned.
“Crackdowns on businesses and individuals participating in the 8.3 Earnings scheme have been surging recently,” a Ryanggang-based source told Daily NK on May 11.
“Many business managers are under a lot of stress because of these crackdowns,” the source added.
The crackdowns are hitting businesses and individuals especially hard given the current dire state of the economy caused by the government’s COVID-19 prevention policies.
The 8.3 Earnings scheme allows workers to pay a specified fee each month to their place of employment so they can skip going to work and conduct their own private businesses instead.
Both businesses and workers widely regard the scheme as a win-win: Businesses do not have to pay salaries and can still earn an income while workers are able to earn money through private business activities.
The recent crackdowns could not have come at a worse time, given the current dire state of the economy. North Koreans are reportedly complaining about the government’s focus on enforcing tougher crackdowns instead of coming up with policies to improve the economy.
Still, North Korean authorities cannot help but pay attention to the side effects of what they call “the spread of capitalist culture.” In fact, the government is pushing back against 8.3 Earnings as part of efforts to root out “anti-socialist phenomena.”
“Many have pointed out that the state has no real role in individuals earning money anymore and that this is why [the government] wants to reassert control,” the source said.
“[North Korea’s leadership] has made it known that the Cabinet will now be reasserting control over the economy, which suggests the state will take ‘legal action’ against the 8.3 Earnings scheme,” the source added.
Many businesses are reportedly scrambling to organize their books. Many business people seem to think that they will be unable to evade the crackdowns through bribes like in the past.
“Nowadays, there are ‘8.3 Work Units’ in many companies so the crackdowns are bringing about widespread discontent,” the source explained.
“It would make more sense [for the government] to get rid of the 8.3 Work Units first and then conduct crack downs, but they seem to be putting the cart before the horse,” he noted.
Primary (특급) factories along with first and second-tier companies benefit from the 8.3 Earnings scheme, which means that getting rid of the scheme could harm factories and other businesses, the source added.
*Translated by Gabriela Bernal
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