An overall consensus is spread out to provide a pivotal momentum for the role of public finance and legal institutions to alleviate the abrupt eruption of mass unemployment caused by the global financial crisis since last September. This report aims to keep a close support up for the National Assembly's commitment to combat the recent job crisis. It scrutinizes the possible contours of reformulating budget and legislation procedures to maximize its effective reinforcement and minimize any adverse effects on the labor market.
First, the budget amount for job support program is around 4.5 trillion won in 2009, with 2.7 trillion won allocated for 320,000 job opportunities in such fields as social services, short-term employment. That amount, however, would not cover the additional, increasing demand for jobs from the people who are vulnerable to unemployment. For instance, social caring services that are recognized as major jobs for elderly women, are supposed to provide only 45,000 of the planned total 320,000 job opportunities with just 278 billion won. It may be rather imperative to bridge or close such an enormous gap between planned and actual budget allocation under the current circumstances of the severe blow of mass unemployment on buffered households. It also traces out the feasible solutions to resolve some other pending issues in the current job support programs: the virtual absence of an administrative headquarter which can effectively reinforce planning programs on the right track, the shortage of budget amount to meet such a scheme and the systematic failure in making a feedback process for reformulating legal institutions for job-sharing support programs, and the poor financial capability of local government to raise its own revenue independently to carry out the programs passed down from the central government. The last problem may be more accentuated in parallel with the shortage of its own local budget for financing the required local government’s expenditure. This discrepancy ends up with exacerbation of mass rural unemployment in amidst of brisk demand for the unemployment benefit.
Second twenty job-related bills are also studied here broken down into four categories by purpose: maintenance and creation of jobs, job training, expansion of the social safety net, and the introduction of new institutions. This report has captured a pivotal momentum to put forward the imperative need to pass the employment-related legislations such as Employment Insurance Amendment Bill and Social Enterprises Nurturing Amendment Bill, in a due time as a means of abiding by the strong commitment of job support programs. The stimulus for reviving the vitality of working force may be subdued or halted if the legislation procedure is derailed without any economic rationale.
Third, measures to boost the economy and create jobs in developed countries, such as US, Japan and the UK, are deemed as direct support and expanding the social safety net for vulnerable people, boosting consumption by temporary tax cuts, and creating jobs by expanding social services. Together with the traditional SOC investment, those countries emphasize to create 'good jobs' mainly by unfolding a massive amount of investment on the engines of the future growth.
On balance, this report puts forward a package of modest proposals which may contribute in sterilizing the negative effects of the current financial crisis on the labor market.
1) It may be imperative to increase the available slots for short-term employment by bolstering public expenditure.
2) The effects of job-creation should be enhanced mainly through setting up expenditure priorities, which emphasizes direct supports for vulnerable people in the short-term and the need to amplify the potentials for creating good jobs in the long-term.
3) Investments in the areas of education and green growth should be increased to guarantee good jobs in the future. The Korean government is planning to invest around 4.4 billion won to create 93,000 new jobs in 2009 to meet this target.
4) Institutional and financial support should be given to encourage employment maintenance. These require institutions to offer benefits to such groups as entrepreneurs who have practiced job-sharing. It is also important to ease requirements in government's employment maintenance support.
5) Social safety net coverage for vulnerable workers should be widened. This effort could include allowing self-employed businessmen to be insured with unemployment benefits. In addition, this could support living expenses for low-income job trainees.
First, the budget amount for job support program is around 4.5 trillion won in 2009, with 2.7 trillion won allocated for 320,000 job opportunities in such fields as social services, short-term employment. That amount, however, would not cover the additional, increasing demand for jobs from the people who are vulnerable to unemployment. For instance, social caring services that are recognized as major jobs for elderly women, are supposed to provide only 45,000 of the planned total 320,000 job opportunities with just 278 billion won. It may be rather imperative to bridge or close such an enormous gap between planned and actual budget allocation under the current circumstances of the severe blow of mass unemployment on buffered households. It also traces out the feasible solutions to resolve some other pending issues in the current job support programs: the virtual absence of an administrative headquarter which can effectively reinforce planning programs on the right track, the shortage of budget amount to meet such a scheme and the systematic failure in making a feedback process for reformulating legal institutions for job-sharing support programs, and the poor financial capability of local government to raise its own revenue independently to carry out the programs passed down from the central government. The last problem may be more accentuated in parallel with the shortage of its own local budget for financing the required local government’s expenditure. This discrepancy ends up with exacerbation of mass rural unemployment in amidst of brisk demand for the unemployment benefit.
Second twenty job-related bills are also studied here broken down into four categories by purpose: maintenance and creation of jobs, job training, expansion of the social safety net, and the introduction of new institutions. This report has captured a pivotal momentum to put forward the imperative need to pass the employment-related legislations such as Employment Insurance Amendment Bill and Social Enterprises Nurturing Amendment Bill, in a due time as a means of abiding by the strong commitment of job support programs. The stimulus for reviving the vitality of working force may be subdued or halted if the legislation procedure is derailed without any economic rationale.
Third, measures to boost the economy and create jobs in developed countries, such as US, Japan and the UK, are deemed as direct support and expanding the social safety net for vulnerable people, boosting consumption by temporary tax cuts, and creating jobs by expanding social services. Together with the traditional SOC investment, those countries emphasize to create 'good jobs' mainly by unfolding a massive amount of investment on the engines of the future growth.
On balance, this report puts forward a package of modest proposals which may contribute in sterilizing the negative effects of the current financial crisis on the labor market.
1) It may be imperative to increase the available slots for short-term employment by bolstering public expenditure.
2) The effects of job-creation should be enhanced mainly through setting up expenditure priorities, which emphasizes direct supports for vulnerable people in the short-term and the need to amplify the potentials for creating good jobs in the long-term.
3) Investments in the areas of education and green growth should be increased to guarantee good jobs in the future. The Korean government is planning to invest around 4.4 billion won to create 93,000 new jobs in 2009 to meet this target.
4) Institutional and financial support should be given to encourage employment maintenance. These require institutions to offer benefits to such groups as entrepreneurs who have practiced job-sharing. It is also important to ease requirements in government's employment maintenance support.
5) Social safety net coverage for vulnerable workers should be widened. This effort could include allowing self-employed businessmen to be insured with unemployment benefits. In addition, this could support living expenses for low-income job trainees.