Listen to Kim’s proposal

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Listen to Kim’s proposal

 Kim Chong-in, acting chief of the main opposition People Power Party (PPP), proposed a revision to the labor act. “The labor market has stayed off-limits and a sanctuary,” he said. “Without addressing the outdated labor law, much-needed industrial restructuring since the Covid-19 outbreak, cannot be possible.” His point has been repeatedly raised by experts at home and abroad. We welcome his timely diagnosis.

Korea’s national competitiveness on the World Economic Forum scale has been rising annually, but its rank in labor affairs has been backtracking. Korea was in the bottom group at 102 on employment and dismissal and 130th in labor management cooperation. The need for changes in the labor law drawn up during the industrial age when the economy relied on factory output became imperative as the pandemic has accelerated the speed of industrial transitions.

The ruling Democratic Party (DP) responded negatively, saying labor reform is not under consideration. The liberal party has stayed passive on labor reform even when it is essential to economic advances and industrial restructuring just for fear of angering its vote base. But the economic conditions are too poor to pay heed to the unions. Labor reform is essential to ease the deepening income polarization and youth unemployment.

Labor reform is hard for every government and country. Labor reforms were mostly undertaken by liberal governments as they can better convince workers.

The Hartz concept in 2003 was pivotal in restructuring the German economy. Germany was at its worst since unification amid surging unemployment and social welfare costs with pension and unemployment coverage making up a whopping 70 percent of average salaries. Then chancellor Gerhard Schröder risked his political career despite strong opposition from the ruling Social Democratic Party to push ahead with a set of reforms. His party lost the election as a result, but Germany recovered from its post-war shame to become the growth engine for Europe through the restructuring.

The Moon Jae-in administration can also carry out the hard task if it has the will. Kim, interim leader of the PPP, urged the DP to make most of its supermajority with nearly 180 seats in the National Assembly to fix the labor law for the future of the country. It must set its eyes on the farther future not just a few years later to extend its term.
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