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(EDITORIAL from Korea Times on Sept. 7)

Editorials from Korean dailies 07:07 September 07, 2021

Gloom over job market
Take bolder steps to create decent jobs for youth

Despite the advent of fall, regarded as the optimum season for hiring, the employment market has continued to remain frozen with no signs of thawing soon. The situation is all the more serious as the nation's top conglomerates are increasingly reluctant to recruit new employees en masse.

The Korea Economic Research Institute (KERI) unveiled research Monday, based on a survey of the nation's top 500 companies by revenue, which showed only 32.2 percent of the 121 that responded have plans to hire new employees in the latter half of the year. The remaining 67.8 percent replied they had no hiring plans, compared with 63.3 percent seen in a similar survey in the first half of the year.

This means the employment situation has continued to worsen ― the number of unemployed people among those with a college or graduate degree stood at 485,000 at the end of June, casting a darker cloud over the tight job market.

Enterprises are finding it more difficult to increase new hiring amid the persistent COVID-19 pandemic coupled with the steep rise in the minimum wage and the introduction of the 52-hour workweek system. Given this, the government should take bolder steps to find a solution to the problem.

Regarding hiring difficulties, according to the KERI survey, 32.4 percent cited the economic hardship arising from the pandemic, followed by a lack of labor market flexibility (14.7 percent) and growing labor costs (11.8 percent).

According to data compiled by Statistics Korea, the number of unemployed young people reached 370,000 last year, down 56,000 from 2016. This means the unemployment rate among young people decreased to 9 percent from 9.8 percent over the past four years. Statistically, this means an increase in employment.

Yet, what matters is the chronic lack of decent jobs. The number of young people who sought decent regular jobs while doing part-time work almost doubled to 149,000 in 2020 from 76,000 in 2016. This reflects the stark reality of the job market many youngsters face. This has been partly due to the Moon Jae-in administration's failure to create decent full-time jobs instead of only part-time jobs.

Prompted by a rapid shift toward state-of-the-art industrial tools such as the use of artificial intelligence (AI), businesses are changing the way workers are recruited. They are preferring an "on-demand" hiring method as opposed to the large-scale one-time hiring of students before they graduated used in the past. Additionally, they favor those with engineering and science diplomas over those majoring in humanities.

Now the Moon administration should pull out all the stops to create a more favorable business climate that can help employers hire more workers. It also needs to push for deregulation and boost labor market flexibility. The government also needs to encourage innovation to offer more job opportunities.
(END)

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