Saving our industries

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Saving our industries

The Moon Jae-in administration has presented a bold plan to create 550,000 jobs with the injection of 3.6 trillion won ($2.9 billion) to ease our ever-worsening unemployment situation. The government also decided to forge a whopping 40 trillion-won fund to help stabilize our mainstay industries to prevent massive layoffs.

In the fifth emergency economic meeting Wednesday, President Moon vowed to “mobilize all available policy tools to keep jobs from disappearing across mainstay industries that play a pivotal role in maintaining employment in Korea.” That was a reaction to the grim reality in which nearly 2.4 million people simply gave up looking for jobs after the coronavirus outbreak in February.

The government took an appropriate step to mitigate deepening pain among the younger generation and the socially weak, in particular. But it must not forget that fiscal inputs alone, no matter how big they are, cannot address the massive unemployment crisis facing the nation. Jobless benefits claimed last month alone already reached 900 billion won, and a 500 billion-won fund to help employers keep their employees will most likely be depleted soon.

In a nutshell, jobs are created by companies, as clearly seen in developed countries that are pouring in billions of dollars to support their corporate sectors. Korea’s mainstay industries are facing unprecedented liquidity crises due to a critical dearth of demand at home and abroad. After suffering 6.3 trillion won in losses in the first half, airlines have put a number of their employees on unpaid leave. Expressing concerns about their “collapse probably within a couple of months,” local carmakers are begging for help from the government. For the auto industry alone, 1.8 million jobs are at stake.

We welcome the government’s measures, albeit belated, to protect key players. Once it takes the right direction, speed becomes important. The government must help airlines and carmakers stay afloat. It must also help contractors for Hyundai Motor and other automobile companies to overcome their suffocating liquidity crises. Petrochemical companies, which are excluded from the support package, also need benefits like tax deductions.

The government has not set a standard for emergency relief grants to low income groups. Owners of mom-and-pop stores across the country still have to wait in long queues to apply for loans from banks. The government must not repeat such policy mistakes this time. As the plan to stabilize our industries requires approval from the National Assembly, the ruling party must expedite legislation. If our enterprises collapse, our lives collapse too.

JoongAng Ilbo, April 23, Page 30
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