Road map to nowhere

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Road map to nowhere

The government’s road map for the next five years to create jobs can hardly avoid criticism because it lacks fundamental solutions to the serious unemployment issue facing the Korean economy. In Wednesday’s meeting presided over by President Moon Jae-in, the Presidential Committee on Job Creation included five fields, 10 key tasks and 100 policies in its initiative. It is focused on creating 810,000 jobs in the public sector along with additional jobs in the private sector through innovative growth based on revitalization of new industries and start-ups.

At first glance, the plan sounds acceptable as it aims to enable the public sector to prime the pump in creating jobs — given the alarming 21.5 percent jobless rate among the young — while helping private companies do their share by fostering new industries and start-ups. On top of that, the government plans to start vocational training programs to meet the growing demands for a top-caliber workforce.

The problem is a lack of economic inducements for companies to boost hiring on their own. Job creation should be backed by entrepreneurship and investment. But many companies face a hostile business environment due to over-regulation. Our laws ban hospitals from offering remote medical examinations and treatment, not to mention a myriad of obstacles in installing cable cars in tourist spots. Even though the Services Industry Development Act and Regulation-Free Zone Act were proposed long ago, Moon and the ruling party have opposed them, saying they only benefit large companies.

The road map is basically based on the premise that a dramatic increase of jobs in the public sector will lead to more jobs in the private sector. Really? Putting aside the cost — a whopping 5 trillion won ($4.42 billion) a year — the plan will only consolidate our distorted employment structure.

Moon’s minimum wage increase is another hurdle. The government’s push will only force an increasing number of companies to stop hiring, as seen in apartment complexes’ efforts to use automatic entrance and exit systems instead of security guards. The government’s initiative to assist 2.3 million workers involved in the insurance business and golf courses to form their own labor unions also does not help create jobs. What we need is a grand compromise between labor and management to ensure that unions make concessions as their employers hire more. Without deregulation and labor reform, the road map is an empty slogan.

JoongAng Ilbo, Oct. 19, Page 38
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