(EDITORIAL from Korea Times on Feb. 15)

Doom and gloom
Country suffers largest job loss in two decades

The Moon Jae-in administration needs to overhaul its job creation policy as the country reported its largest monthly job loss in January. According to Statistics Korea, the number of employed people stood at 25.8 million last month, recording a fall of 982,000 jobs from a year earlier. The reduction was the steepest since December 1998 when 1.28 million jobs disappeared following the 1997-98 Asian financial crisis.

As a result, the unemployment rate surged by 1.6 percentage points year-on-year to 5.7 percent last month, hitting a record high for any January since 1999. The jobless rate for people aged between 15 and 29 shot up to 9.5 percent. All these gloomy figures were attributed to the devastating economic fallout from the long-lasting COVID-19 pandemic.

It was inevitable -- to a large extent -- for the country to see the unprecedented public health crisis taking its toll on the jobs market. Lodging and dining businesses were the most vulnerable to the pandemic with their job losses amounting to 367,000 last month. The wholesale and retail sectors shed 218,000 jobs. Temporary workers lost 563,000 jobs, followed by day laborers with 232,000 jobs and the self-employed with 158,000 jobs.

The employment market has been battered by tightened social distancing guidelines and quarantine measures. The health authorities raised the social distancing guidelines to Level 2.5, the second-highest, in Seoul and its surrounding metropolitan area Dec. 8 and Level 2 in other regions to fight the third viral wave. This has put a ban or other restrictions on the operation of crowed places such as restaurants, bars, nightclubs and indoor gyms.

On Saturday, the government decided to lower social distancing rules to Level 2 for Seoul, Incheon and Gyeonggi Province, and Level 1.5 for the rest of the country for two weeks from Monday. Under the decision, restaurants and some other public facilities in Seoul and its vicinity will be allowed to extend operations by one hour until 10 p.m. However, a ban on gatherings of five or more people will remain for the time being as the number of daily new infections stayed above 300 during the Feb. 11 to 14 Lunar New Year long weekend.

Against this backdrop, the depressed job market is not showing signs of tangible improvements anytime soon. Some analysts predict that doom and gloom will prevail until the nation completes its vaccine program to build herd immunity in the latter half of the year. This could mean the worst has yet to come as far as jobs are concerned.

The Moon administration has so far relied on offering public sector jobs amid the prolonged economic slump. This policy is a stopgap measure. The government cannot solve the problem without encouraging private businesses, the main actors of generating jobs, to hire more people. It must create an environment favorable to job creation. It is also imperative to push for bolder deregulation and promote innovation, not only to speed up economic recovery but also to offer more jobs.
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