Massive Job Creation Project to Ease Youth Unemployment

      July 28, 2015 10:44

      The government hopes to create 200,000 new jobs by 2017 in a bid to ease youth unemployment, it said Monday.

      The youth unemployment rate has surged to levels last seen just after the 1998 Asian financial crisis and is expected to worsen when the retirement age for government and private workers is extended by two years to 60 next year.

      At the heart of the plan is the creation of at least 70,000 permanent jobs for young adults. The government aims to achieve this with money saved from wage cuts for 8,000 private and public sector employees whose retirement has been extended.

      Left: Youth groups rally urging trade unions to adopt a wage peak in Seoul on July 14, 2015.; Right: Trade union members announce a general strike in Seoul on July 15, 2015.

      The idea is to increase the overall workforce by introducing a wage peak, which involves the lowering of wages of workers nearing retirement in exchange for extending their time on the job.

      The money saved is then to be used to hire 8,000 young people. Some 15,000 new teachers will be hired by retiring existing teachers who are close to the end of their career.

      The government plans to provide incentives to private businesses to create 26,000 permanent jobs, while searching for 5,000 jobs overseas for young Koreans.

      Up to W10.8 million a year in cash will be provided for each new full-time worker employed in companies that expand their overall workforce. Public bodies will receive W5.4 million for each new full-time worker employed (US$1=W1,167).

      But experts say more fundamental changes are needed, such as increased flexibility to hire and lay off workers and narrowing the wage difference between full-time and temporary workers.

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