On the 4th (local time), one of the reasons cited for the arrest of Korean workers in a joint raid by U.S. immigration authorities at the construction site of the LG Energy Solution and Hyundai Motor electric-vehicle battery joint plant is the low level of local construction hiring. The construction industry says U.S. clients prefer Korean-affiliated contractors in the United States due to communication issues with U.S. firms and pressure to shorten construction timelines.
About 300 Korean workers arrested and detained in a joint operation by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), and the Drug Enforcement Administration (DEA) mostly entered the country under the Electronic System for Travel Authorization (ESTA) or the B-1 short-term business visitor visa.
ESTA is issued for noncommercial purposes such as tourism. However, many domestic corporations have routinely used the program for employees' short-term assignments in the United States. Construction of the Georgia plant targeted in the raid was handled by Hyundai Engineering, an affiliate of Hyundai Motor Group, and its partners, and it became a problem that most of them also entered and worked on ESTA and B-1 visas.
Ko Bae-won, CEO of Integra D&C, a construction and civil engineering services firm, said one reason domestic corporations choose Korean firms over U.S. contractors is that U.S. contractors often require cumbersome procedures to reflect design-change requests and frequently demand additional payment.
Ko said, "Unlike in Korea, where the client can do as it wants, U.S. contractors bill for even minor items and, if you want a design change, they require a change request form. In the end, domestic corporations facing pressure from schedule extensions and expense burdens either rely on Korean Americans who know U.S. procedures well or bring in partner-company employees on tourist visas, have them work for up to 90 days, and then send them home."
Another reason cited is the greater difficulty in decision-making and communication when working with U.S. companies. Client representatives dispatched from Korea are experts in their fields, but many are not proficient in English and lack background knowledge of U.S. construction standards. U.S. contractors exploit these weaknesses and keep billing additional costs. As a result, clients inevitably prefer domestic firms with no communication problems and to whom they can demand quick work.
Ko said, "Even if lodging and meals are provided, domestic workers communicate well, are easier to direct, and there is no need to worry about joining U.S. construction unions," adding, "Subcontract payments can be made from Korea, so many do it that way." He said, "Even now, we need to set construction expenses and timelines to fit U.S. realities and find ways to properly manage from the design stage through execution."
Large domestic companies also seek domestic contractors to maintain security. The LG Energy Solution–Hyundai Motor joint plant that was targeted in the raid was built by Hyundai Engineering, an affiliate of Hyundai Motor Group, in part to prevent technology leaks.
At the LG Energy Solution–Hyundai Motor joint plant, most processes had been wrapped up, and only steps such as installing battery production lines and equipment inside reportedly remained.
An official in the finished-car industry said, "Many domestic corporations will invest in the United States going forward, and they will inevitably face similar problems," adding, "The government and diplomatic authorities need to step in to increase visa quotas needed for workers' short-term assignments."