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Civil service costs

Published: 18 May. 2020, 21:03

Sohn Hae-yong
The author is a business news editor of the JoongAng Ilbo.

Job community sites often debate on the choice between the most secure workplaces ? the central government or Samsung Electronics. A seventh rank in the nine-grade civil servant office is preferred over a job at the tech company. A government job is safe for life. Compared to Samsung Electronics, work intensity, pressure on performance and competition are less severe. The quality of work is therefore better.

The public sector pays less than Samsung. But the job is secure until retirement age could be a major reason for dismissal. Simple math shows that working in the government from the junior post of ninth or seventh grade until retirement age actually pays from 360 million won ($292,000) to 810 million won more than retiring from Samsung Electronics when counting in generous public office pension if one lives until maximum 100 years. The choice of the seventh-grade government post is more than twice as popular as landing a job at Samsung Group (68.7 percent versus 31.3 percent) in an online poll.

Public jobs have become more appealing to young people under the Moon Jae-in administration. Since Moon took office three years ago, government jobs have surged. According to government data, the total government payroll reached 1,104,508 as of December, compared with 72,177 under former President Park Geun-hye. Since Moon took office in May 2017, an average 27,271 public employees were added on average annually, far outnumbering 9,875 yearly average under Park, 2,423 under another conservative President Lee Myung-bak and even 14,889 under former liberal President Roh Moo-hyun.

This year, government posts will increase by more than 60,000. The government has been raising the cap for government employee posts annually, which is also unprecedented. When including the expansion in enterprises under state management and funding, the bulging of hiring in the public sector has been excessive.

The government argues public job increases are aimed at stimulating overall employment and raising standards in the civil service. Some of the increases are necessary. But once the public sector expands, it cannot easily be scaled back.

President Moon Jae-in, far left, joins a lunch with newly hired civil servants at a cafe in the Central Government Complex in Sejong, Jan. 21. [JOINT PRESS CORPS]

President Moon vowed to add 174,000 government employees by 2022. The National Assembly Budget Office estimated the plan would cost the nation 328 trillion won (excluding pensions) while Korea Taxpayers Association projects 419 trillion won. The future generation would have to shoulder the cost of an outsized public sector on top of the burden for increased welfare benefits. The government must prudently deliberate whether the expansion will serve good after 10 to 20 years if it really wants to add government employees.

If public sector jobs stay outsized against the private sector, it would be further discouraged in hiring. According to a study by the Organization for Economic Cooperation and Development, when one government job is added, 1.5 disappear in the private sector. Young people who can contribute to improvement in productivity can waste their potential by studying for civil servant exams instead of seeking private sector jobs. The fourth industrial revolution age requires innovation and creativity. If young talent chases government jobs, innovation can hardly be stimulated.

Hyun Jung-taek, who served as the head of the Korea Development Institute and senior presidential policy cooperation secretary, warned that unlike in the 1990s when there had been solid increases in our working population, the working population has been thinning since 2017. Greece and Argentina ran into default crises because of their outsized public sectors.

JoongAng Ilbo, May 18, Page 30