[NOTEBOOK]Time for hard economic work

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[NOTEBOOK]Time for hard economic work

An executive at one of the largest companies in Korea retired at the end of 2002. Having spent nearly ten years abroad in overseas offices, he was fluent in English and is a single-handicap golfer. He thought he would begin a second career by opening a real estate agency or a golf driving range for foreign customers. But there were many competitors, and he saw no chance of winning the fierce competition. He has sent resumes to employment agencies, but he hasn’t heard from them yet. His retirement funds are running out rapidly.
Recently, an electronics company announced that it would hire 15 people this year. During the industrial boom in the 1970s and 80s, Hyundai, Samsung, LG, Daewoo and other conglomerates would hire a few thousand employees every year in open annual recruiting. In 2004, no company can afford to take a hundred or a thousand more people. A company can take pride just in the fact that it is still hiring a few people. Because companies are reluctant to hire, openings attract a tremendous number of applicants. It is not uncommon to see over a hundred people applying for each job opening.
From new graduates to the experienced middle-aged workforce, the ubiquitous fear of soaring unemployment is haunting society. But President Roh Moo-hyun’s New Year’s address sounded like a belated lament about the damage already done.
While the president said that creating jobs would be at the top of his administration’s policy priority list, he did not explain or apologize for his policy blunders.
Last year, 30,000 jobs disappeared from Korea. At the end of 2003, 370,000 people in their 20s were actively seeking jobs but were unemployed. Including those who had given up looking for a job and hence were not included in the statistics, the actual unemployment rate would be nearly double the official figure. The young generation is more educated, speaks better English and is more computer-savvy. The unemployment rate is high not because of the unemployed youth themselves, but because the established generation failed to create a better workplace and more jobs.
Businesses need to realize that hiring is the best way to contribute to society. Those who already have jobs should refrain from selfishly raking in their own share. But above all, the government has been delinquent in its duty to manage the country’s job market. If Mr. Roh wanted to make a point of the administration’s will to lower the unemployment rate in his address, he should have begun by apologizing for failing to create more jobs last year.
The Roh administration has not yet revealed specific plans to reform the job market. Mr. Roh said he would call a conference of business leaders to discuss how to create jobs. But the idea was vague and uninspiring. He did not specify who would join the conference. Also, we are worried that government and industry would spend nights and days arguing and still fail to come up with plausible solutions.
Creating jobs is not easy. We all know the obvious and sure-fire solution. The entities that create jobs are companies. If the government provided a friendly environment in which to do business, companies would soon want to expand. First, the government needs to know what companies want.
In the information technology-driven era, the rapid growth of 10 percent or more that we experienced in the 1960s and 1970s is nearly impossible. The new economy does not require the mass workforce that the industrialization era needed. But at the same time, the borders have disappeared when it comes to investment. So the key to the unemployment puzzle is how to attract foreign companies to Korea and how to keep Korean companies here.
The free flow of investment capital has made nations around the world compete to attract foreign companies. Some countries provide land for free if a company wants to build a plant. Nearly every developed country considers attracting investment and creating jobs to be the No. 1 economic policy agenda item. Last year, the overseas investment of Korean companies exceeded the amount of investments foreign companies made in this country. If the unbalanced and unhealthy equation persists, creating jobs in Korea will be a pie-in-the-sky idea.
Mr. Roh used three-quarters of his New Year’s address to talk about the economy. He sounds as if he is focused on reviving the economy, so he should meet, listen and interact with the economic players. He needs to get input from those running small businesses and merchants in markets as well as the chairmen and presidents of the industry giants. He also needs to allot some time to meeting with foreign businessmen working here. The challenge is the time available, and the key is action. Businessmen say in unison that no miracle cure can save the economy once companies have relocated abroad.

* The writer is business news editor of the JoongAng Ilbo.

by Min Byong-kwan
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