In North Korea, operating a taxi (also known as a cab) is a profitable industry, but women in the country are unable to obtain driver’s licenses. As a result, some affluent women opt to purchase taxis as an investment, then hire young men to work as drivers. These men eagerly vie for the opportunity as driving a taxi can earn them $1 per day, which is considered a generous wage for them.
According to Radio Free Asia, sources in North Korea informed the station that while taxi companies in the country are nominally state-owned, they are actually privately operated. The competition among drivers is intense, to the extent that a driver can only be employed for a single day at a time.
This scenario exemplifies a supplementary income activity within North Korea’s emerging market economy. Due to the inability to earn sufficient wages from government-assigned jobs, most households must seek alternative means of income.
Most private taxis in North Korea are mini-vans made in China, purchased by wealthy women who then hire male drivers since females in the country are prohibited from obtaining driver’s licenses and legally driving vehicles.
A resident from Pyeonganam-do in North Korea told the Korean service of the station, “Now in Anju City, if you operate a mini-van converted taxi for a day, the taxi owner will pay you 20,000 North Korean won (1 US dollar).”
The resident mentioned a significant increase in earnings for taxi drivers in the past month due to fluctuations in exchange rates between North Korean won, US dollars, and Chinese yuan. North Koreans tend to prefer currencies like the dollar and yuan due to their stability.
While most companies in North Korea are directly owned and operated by the government, at least in name, taxi companies operate similarly. However, the taxi companies do not own the fleet of taxis; they are privately owned vehicles that owners must register with these companies for legal operation. Therefore, owners are responsible for the vehicle and maintenance costs.
Another resident from Pyeonganam-do revealed that taxi companies can acquire 30% of the profit, while the owners receive 70%.
The first resident noted that finding taxi drivers has never been an issue. Wealthy women who own taxis typically hire drivers near Anju City train station every morning, where numerous young individuals queue up. Driving a taxi for just a couple of days can earn them more money than a factory worker’s monthly income.
There are drivers who can take customers on long-distance trips up to 100 kilometers away, earning them between 50,000 to 100,000 North Korean won (2.5 to 5 US dollars).
In North Korea, only males serving in the military or working in factories with government approval are eligible to undergo driving training, which can take three to six months to complete. Successful candidates receive a Class 4 license, which can be upgraded through additional training to Class 3 (allowing driving of trucks and buses), Class 2 (permitting driving any vehicle type), and eventually Class 1 (earning a license to design or manufacture automobiles). Most individuals aspiring to become taxi drivers aim for at least a Class 3 license.
The second resident also mentioned that although North Korean women are legally prohibited from driving taxis, owning a taxi provides them with an opportunity to escape the arduous tasks of operating family businesses (selling goods and services in markets). They can invest the money earned in the market into owning a taxi and subsequently employing male drivers to operate them.
He added that hiring taxi drivers has become an employer’s market. Previously, drivers were typically hired through familial or relational connections, but this is no longer the case.
He explained, “This is because if you hire someone you know, it will be challenging to reduce their daily wage in case of poor driving skills or accidents.”