Plan increases jobs, housing for young adults

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Plan increases jobs, housing for young adults

The Korean government is focusing on creating jobs while increasing the number of affordable apartments for young people as the economy continues to weaken.

As a turnaround isn’t currently in sight, the government has decided to focus on stabilizing the spreading insecurities, particularly among young people and middle- and lower-income households.

Public institutions will hire 1,000 more people in the first half, or 10 percent more than they did in the past year, the Ministry of Strategy and Finance said Thursday. A total of 19,862 will be hired this year and 11,000 will be hired in the first half of the year.

This was part of the plan that economic officials, including the Ministry of Strategy and Finance, the Ministry of Trade, Industry and Energy, the Ministry of Land, Infrastructure and Transport and the Financial Services Commission delivered to acting President Hwang Kyo-ahn on Thursday.

“Public institutions tend to come up with their hiring plans conservatively and we think the actual number might be higher than it is now,” said an official at the Finance Ministry. “We will also consider expanding it when found needed after looking at performances of the first half of the year.”

The Finance Ministry also said it has adopted a system to monitor government subsidies, which will help prevent 1 trillion won ($840 billion) from being distributed illegitimately.

The land ministry laid out its plans for affordable housing to ease financial burdens on young people. The high cost of buying a home has been seen contributing to young people avoiding marriage, which has led to a decline in Korea’s labor force. The government estimated that the productive workforce population will begin to shrink this year as the birth rate remains one of the lowest in the world and the population ages rapidly.

The government will increase the number of so-called Haengbok apartments that are offered to college students and newlyweds, from 38,000 last year to 48,000 this year, the Ministry of Land, Infrastructure and Transport said. Rent prices for such units are 60 percent to 80 percent cheaper than average prices in the region.

In particular, the government will supply as many as 3,000 affordable housing units in three districts of southern Seoul: Seocho, Gangnam and Songpa.

The Industry Ministry also said it will allocate 17 trillion won to develop new growth industries, which it hopes will create 30,000 jobs. The government hopes new industries will help boost struggling Korean exports. Funding will partially be contributed from private companies, although the exact amount hasn’t been revealed.

The money will be spent on 12 industries, including Internet of Things, drones and autonomous vehicles, the Ministry of Trade, Industry and Energy said.

“The investment will help create about 30,000 new jobs in the country and it is expected to help Korea’s exports as well,” an official at the Trade Ministry said. “We expect this year’s exports to grow 2.9 percent year on year from $495.5 billion last year to $510 billion this year, which will end two consecutive years of a fall in exports.”

However, analysts said the fund might not be formed because the private sector is staying away from participating in government-run projects after the recent outbreak of the political scandal surrounding President Park Geun-hye and her confidante Choi Soon-sil. Also even if the investment falls through, some analysts believe it will take quite some time before the outcome becomes visible.

“There are various political uncertainties, as many are aware of, and they will have negative impacts [on forming funds],” said Park Sang-hyun, an economist at HI Investment & Securities. “Even though companies come up with investments, it won’t make the economy grow right away, as it often takes long periods for outcomes to come from such investments.”

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