The customer is always rightPARK TAE-HEE
*The author is an industrial news reporter for the JoongAng Ilbo.
The service sector has an advantage in job creation. The Hyundai Economic Research Institute’s recent study shows that the employment inducement coefficient — the number of jobs created per 1 billion won ($896,450) — is 16.2 for the service sector. It is twice the manufacturing sector’s 7.4. That’s why the service sector has been considered a good option for creating jobs. As the service industry has low barriers to entry, beginners can easily start their careers in this industry.
The manufacturing industry also has a great impact on job creation. In the service industry’s employment inducement coefficient, 15.1 people out of 16.2 are within the industry while only 1.1 are in other industries. But for the manufacturing sector, 4.3 among 7.4 are in other industries. The manufacturing industry has a close relationship with other industries, such as logistics and supply. Also, many large corporations that college graduates prefer are in the manufacturing industry, and they offer quality jobs. The JoongAng Ilbo’s report on June 25 shows that the top 100 companies are mostly in the manufacturing industry and shows the trend of “growth without employment,” or the waning need for workers. However, as the total number of companies grow, overall employment is bound to increase.
The number of jobs can increase when the service and manufacturing industries flourish. The government needs to make sure that current policies help these two industries. There is a bill that has been sleeping for seven years in the National Assembly. It is a bill to encourage competitiveness and productivity in the service industry through government support. The bill is no longer being discussed after a few hearings. The service industry has not had a chance to spread its wings. The manufacturing industry has also been hurt by reduced working hours and the rise in minimum wage.
For the Moon Jae-in administration to become a true “job-creating” administration, there are more urgent tasks to be done than income-driven growth. All employment-related policies — ranging from the service industry promotion act to deregulation, reshoring, employment flexibility and public R&D outcome sharing — should be reviewed. In the process, the voices of companies should be heard. Without ample preparation, the administration could end with the worst unemployment rate in history, let alone be branded as a “job-creating” administration.
JoongAng Ilbo, June 26, Page 29