Young People to Face Toughest Job Market Ever
The job market in Korea has been tough for some time now and is expected to get even tighter over the next three years as a record number of university graduates look for work.
Men who started university between 2010 and 2012 and women who did so between 2012 and 2014 are expected to bear the brunt. Student numbers had never been higher, exceeding 350,000 for the first time in 2010 and reaching 360,000 three years ago.
And now they are all entering the job market, but just as they do, businesses are cutting back on hiring. Labor Ministry data shows big companies with more than 300 staff plan to hire only 29,792 new workers this year, the fewest in eight years.
That poses another headache for the government, which is already grappling with a sagging economy. Labor Minister Lee Ki-kwon said, "Young jobseekers including this month's graduates could face the toughest job market since the 1997 Asian financial crisis."
Some forecasts point to Korea's youth unemployment rate surpassing 10 percent for the first time ever. One staffer at a major business conglomerate said, "We are bracing for a currency war following the inauguration of U.S. President Donald Trump, while the Choi Soon-sil scandal here has made it extremely difficult to carry on normal management operations. It's customary for businesses to cut back on investment and new hires in times of major uncertainties."
In the midst of all this, large shipbuilders are suffering their worst drought ever in new vessel orders and could reduce new hires to levels never seen before.
"The number of vessel orders has plummeted and we face the tough choice of laying off existing workers, to say nothing of hiring new ones," a staffer at a major shipbuilder said.
Few if any of the nation's top 10 conglomerates plan to boost hiring this year. SK is the only one to announce plans to hire 100 more workers than last year at 8,200, and Samsung, Hyundai and LG have said they plan to hire the same number as last year.
A survey by the Labor Ministry shows big businesses plan to cut new hires this year by 8.8 percent compared to 2016, which boils down to 2,862 fewer jobs.
Last month, Incruit surveyed this year's hiring plans of 2,113 listed companies, and 918 plan to cut new hires by 5.2 percent (2,521 fewer jobs) to 45,405 workers. Twenty percent said they will hire no new workers this year.
But the tough job market apparently ranks low on the list of priorities as politicians jockey for position amid a looming presidential election.
Kwon Tae-shin of the Korea Economic Research Institute said, "Youth unemployment not only impacts young jobseekers and their dependent families but also leads to wasted human resources that could become the biggest threat to our society. Politicians should roll up their sleeves and do everything to tackle the problem rather than focusing on a presidential election."