More companies adopt wage plan to hire youth

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More companies adopt wage plan to hire youth

More companies are speeding up their adoption of the peak wage system, aimed at resolving the youth unemployment problem, after the nation’s major conglomerates, including the country’s No.1 steelmaker Posco, announced it will launch the system in its all business units.

According to the Ministry of Employment and Labor, 151 of the 275 companies run by the nation’s top 15 conglomerates - including Samsung, SK, LG, Lotte, Posco, GS and KT - have adopted the system.

GS Group said Sunday that its chairman Huh Chang-soo decided to adopt the peak wage system, which gradually cuts the wages of employees in the years leading up to retirement, after meetings with the group’s 60 executives on Friday and Saturday in Gangwon.

The company said it will implement the scheme in all its business units next year. The group has already adopted it in some affiliates, including GS Caltex, GS Energy, GS Retail, GS Home Shopping and GS E&R.

“In order to make the local economy healthier, we should have young and competitive workers consistently every year,” Huh said. “We also need to create more jobs by expanding investment and with efforts to grow.”

The measure will allow the company to hire more young workers. It said it will hire 9,700 new workers by 2017. Of the 9,700, 1,900 will be college graduates and interns in the second half of this year.

“We currently plan to hire 3,800 workers next year and about 4,000 in 2017,” said a spokesman for GS. The group hired 3,200 workers last year and is expected to hire 400 more this year.

Along with the plans, GS Group will also provide a series of education programs in cooperation with universities in chemical and job experience programs for 800 people to improve college graduates’ competitiveness in the job market.

State-run Korea Hydro and Nuclear Power Corporation (KHNPC) said on Sunday it had agreed with its labor union to implement the system on Friday. The agreement said the scheme will extend workers’ retirement age from 58 to 60.

Workers will receive 65 percent of the salary they earned previously when they turn 58 and receive 60 percent in the final working period.

The company has been negotiating since June and the deal was sealed on Friday. Seventy-nine percent of union members participated and 60 percent voted in favor of the system.

The KHNPC said it expects to hire 535 additional workers in the next two years - 261 in 2016 and 274 in 2017 - which the company said will be the most among state-run companies.

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