Middle-class families: in danger but ignored

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Middle-class families: in danger but ignored

The turmoil of the 1997-98 financial crisis saw many middle-class families sink into lower-class wages and living conditions. These days, however, middle-class families are facing a fresh assault on their standard of living due to ongoing corporate restructuring and the soaring costs of housing and education. But with the government preoccupied with improving the conditions of the working class, many in the middle class fear they are being overlooked. “Greeting the new year, I hope politicians will take a greater interest in the situation of middle-class families,” said Kim Ki-seop, 46, head of the product development team at the Industrial Bank of Korea. “It is not easy to make a good living.” Mr. Kim has worked at the bank for 17 years and now owns a 106-square-meter (126.5-square-yard) apartment in Ilsan, a new residential city northwest of Seoul. His annual salary has jumped by 7 million won ($7,160) this year because of his work team’s successes last year. Yet Mr. Kim does not feel financially safe. He is unsure that he can cover the soaring educational costs for his son in middle school and his daughter in elementary school. He is also concerned about his job. “I saw many friends my age being retired in the aftermath of the financial crisis,” he said. “That might happen to me some day.” Like many of his peers, Mr. Kim is taking a course for a master’s of business administration on weekends in anticipation of needing a new job. The financial crisis hit white-collar workers especially hard. Of the 147 people who have applied since 2003 for training programs operated by the Korea Employers Federation, the Human Resources Development Service of Korea and DBM Korea, nearly 73 percent had been office workers or in the field of research and development. Pressure on older workers to make room for younger people has grown as jobs have become scarce following the financial crisis. An oft-heard quip at local companies runs, “A man who remains in an office until the age of 56 has no shame.” “The administration is not making policies to help relieve middle-class concerns,” Mr. Kim said. Many in the middle class feel that government policies aimed at helping those less well off often depict the middle and upper classes in a poor light, creating conflict between classes, experts said. Such attitudes won’t help stabilize the nation’s middle class, they said. “Since the political influence of the middle class weakened, politicians have been busy attacking ‘vested interests,’ without offering alternative proposals,” said Lee Nae-young, professor of political science at Korea University. “Most middle-class people are tired of ideological or class-based conflicts that have continued for two years under the Roh administration,” said Kim Ho-ki, professor of sociology at Yonsei University. Experts also said that the government must recognize that educational costs are the heaviest burden on middle-class households and should improve public educational services. “With the current administration’s educational policies focusing on equality, they cannot meet middle-class people’s demand for high-quality education,” said Kwon Dae-bong, dean of Korea University’s Graduate School of Education. “With the quality of public education deteriorating, more wealthy families will send their children abroad, which many middle-class families won’t be able to afford. Accordingly, educational and economic inequality will worsen,” Mr. Kwon said. Economists are also urging the government to allow enough high-quality housing for middle-class families to be built. The Aug. 31 measures to curb real estate price hikes, they said, focused too much on reducing demand through taxation while neglecting to boost the supply. “If the government loosens restrictions on reconstruction in southern Seoul, apartment prices there could rise in the short term but will stabilize as supply increases,” said Kim Kwang-doo, professor of economics at Sogang University. Other experts said government welfare programs will have to be reconsidered. “It is very dangerous to think that economic inequality can be solved only through welfare programs,” said Keum Jae-ho, a research fellow at the Korea Labor Institute. “The government should focus its poverty relief programs on the aged and the disabled, while improving opportunities for other poor people by creating more jobs.” In the Netherlands, irregular jobs with contracts of less than one year account for 40 percent of all jobs but few people complain, said Yoo Gyeong-joon, research fellow at the Korea Development Institute. “The government should focus on reducing discrimination against irregular workers rather than cutting irregular jobs. This would get more people in the workforce,” he said. by Special Reporting Team
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