Presidential ignoranceDuring a dinner with the heads of political parties hosted by President Moon Jae-in over the weekend, Sohn Hak-kyu, chairman of the minor opposition Bareunmirae Party, shared what he had heard from the owner of a restaurant he frequents to emphasize how bad business has been. The owner complained that customers prefer to buy makgeolli (traditional Korean rice wine) from convenience stores and drink at home because 3,000 won ($2.60) per bottle at restaurants is too expensive.
It is not an exaggeration for a restaurant near Mount Bukhan in northern Seoul, where Sohn often goes. Even some of the oldest restaurants in downtown Seoul are struggling. Salaried workers dine and drink less after work ever since the enforcement of a 52-hour workweek. They have to watch their wallets and settle for beers and snacks from convenience stores instead of enjoying a decent side dish at a pub. Business has become that bad.
Small businesses — mostly street diners and shops — have been hit the hardest by the steep rise in the minimum wage and a cutback in statutory work hours. Many survive on debt. The potential default ratio in loans for the self-employed measured by the ratio of late payments after more than 30 days has gone up. Building and shop vacancy ratios have also shot up because many had to shutter. The vacancy rate at shops near Sinsa Station in southern Seoul — a popular commercial district — hit 18.2 percent at the end of June. In the first quarter of 2017, there was not a single vacant shop in the area.
It is not only the self-employed who are suffering. Corporate sentiment has sharply sagged as a result of sluggish exports. The employment rate for people in their 30s and 40s has been in a downturn for 24 straight months. As many as 1.18 million full-time jobs that hire for more than 36 hours a week were lost under the Moon administration.
Still, a sense of urgency is yet to be found in the Blue House. Moon’s Chief of Staff Noh Young-min said he could not think of a single misstep made by the the administration. Presidential spokeswoman Ko Min-jung blamed a lack of publicity for the young people sensing a dearth of jobs “when the employment rate has actually gone up.”
They sound as if governance and the effect of policy were being underestimated because of the government’s poor public relations. Everyone knows the job numbers were inflated by government spending. Instead of citing misstated and selective data, Blue House officials must go to the relevant business fields for a clearer awareness of reality.