The Korean government will join forces with businesses to create 200,000 jobs by 2017. The public and private sectors are waging all-out efforts to cope with the "youth employment cliff" that is showing signs of spreading ahead of implementing the obligation of extending the retirement age next year.
The government announced such measures at a public-private meeting headed by Finance Minister Choi Kyung-hwan at the Korea Chamber of Commerce & Industry building on July 24.
Ministers in related departments, including Finance Minister Choi and the leaders of the six leading business organizations, including the Federation of Korean Industries, signed a joint declaration of support and cooperation for the creation of new jobs for youth.
First of all, the government will create 53,000 jobs in the public sector by increasing the number of outgoing teachers under voluntary redundancy programs, introducing the wage peak system in state-controlled agencies and public firms and hiring public servants based on flexible work schedules.
In the private sector, 35,000 permanent jobs are to be created through the establishment of “Support System for Win-win Employment between Generations,” along with 125,000 offerings of apprenticeships or internships.
The government will also revise the Labor Law in Sept. to extend the age range for young job seekers from the ages of 15-29 to 15-34 to help companies hire more young workers. A “Tax System for Increasing Youth Employment” will also be introduced to offer extra tax benefits to enterprises that hire more young job seekers compared to the previous year.
If the government's job-creation efforts go as planned, it expects the employment rate of young people aged 15 to 29 to rise 1.8 percentage points by the end of 2017, from 41.4 percent at the end of June this year. The plan, however, will not be any great improvement for youth employment if it does not achieve tangible results of at least 160,000 jobs created, or 76 percent of the total 210,000 jobs for youth assigned to the private sector.
“They youth will suffer more difficulties in getting jobs for the coming three to four years owing to the extension of the retirement age,” said Finance Minister Choi, explaining the background of the measures. He continued, "The government has ironed out such bold measures to provide support in taxation and budgets, as the youth employment cliff could be developed to be a national issue."
The country's jobless rate for those aged between 15 and 29 reached 10.2 percent at the end of June, marking an increase of 0.9 percentage points from the previous month. The country's overall unemployment rate inched up from 3.8 percent to 3.9 percent over the cited period. As of April 2015, those unemployed in their 20s and 30s with no prior experience numbered 89,000 and 6,000, respectively, according to Statistics Korea.