[Exclusive] Government to Allocate Over 300 Billion KRW for Youth IT Public Jobs

Similar to Local Government Youth Public Work Projects, Monthly Payment of 1.8 to 2 Million KRW

Discussion on Expanding Eligibility for Employment Retention Support Fund

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] As employment shocks caused by the novel coronavirus infection (COVID-19) have been concentrated among the youth, the government has decided to support an information and communication technology (IT) public job project for young people.

According to the Ministry of Economy and Finance, the Ministry of Employment and Labor, and other related ministries on the 20th, the government plans to announce extraordinary employment measures, including a youth public job project, at the 5th Emergency Economic Meeting chaired by President Moon Jae-in this week.

The government plans to focus the youth public job project on the IT sector, assigning tasks such as administrative data digitization and work assistance. To this end, the government will invest more than 300 billion won in funding. The government is planning to pay 1.8 to 2 million won per month per person based on a 40-hour workweek. This is comparable to the current youth special public work project conducted by local governments (40 hours per week, 1.7 to 1.8 million won per month).

A government official emphasized, "Currently, the target of unemployment measures is the youth, not the elderly," adding, "If young people fail to enter the market early, they may lose their abilities and be excluded from society."

The Moon Jae-in administration, which has positioned itself as a job-oriented government, had focused on increasing jobs for the elderly as the employment situation worsened. However, with youth jobs rapidly decreasing due to the recent COVID-19 crisis, the government plans to expand its direct job projects to include young people.

In fact, according to the employment trend data for March released by Statistics Korea on the 17th, the number of employed people in their 20s decreased by 176,000 last month, the largest decline among all age groups. This was the biggest drop since March 2013 (-180,000). This is because new hires by companies have been postponed one after another due to COVID-19, and jobs in retail and wholesale (-168,000) and food and accommodation (-109,000), where people in their 20s mainly work part-time, have significantly decreased. Following this were decreases in the 40s (-120,000), 30s (-108,000), and 50s (-75,000). The only increase was among those aged 60 and over, which rose by 336,000.

However, experts point out that youth direct job projects lack sustainability and therefore will not have an impact on economic growth.

Professor Kim Soyoung of Seoul National University’s Department of Economics said, "Creating jobs without productivity is not very meaningful," and added, "If youth direct job support becomes prolonged or institutionalized, the youth unemployment problem could worsen." Professor Jeon Seongin of Hongik University’s Department of Economics advised, "It is better than giving unemployment benefits, but the period should be limited until the economy recovers."

The additional employment measures to be announced by the government this week will also include support for those in the blind spots of employment insurance. Policies are being explored in various ways to support special employment workers and employees of small businesses with fewer than five workers.

Discussions are leaning toward expanding the scope of eligibility rather than increasing the amount or rate of employment retention subsidies. Employment retention subsidies are a system where the government pays part of the leave or suspension allowance from the employment insurance fund to companies that maintain employment through paid leave or suspension.