"Turning Employment Crisis into Opportunity"… Government Supports Consortium Agreements with Local Governments

Ulsan Auto, Chungnam Energy, Gwangju Electronics, Busan Machinery, etc.
"Expecting Regional Customized Hub Industry Development and Job Creation"

Hyundai Motor Ulsan Plant view. (Photo by Asia Economy DB)

[Sejong=Asia Economy Reporter Moon Chaeseok] As local economic revitalization emerges as a solution to employment and population issues, the government is providing over 33 billion KRW to enable regions concerned about employment crises to independently pursue mid- to long-term job projects. The goal is to create more than 4,400 jobs this year. If local government consortia participate in the projects, the government will support them. If the plan proceeds as expected, the government believes it can expect the activation of key regional industries and job creation in each local government, such as Ulsan’s automobile industry, Chungnam’s energy sector, Gwangju’s home appliances, and Busan’s machinery industry.

According to the Ministry of Employment and Labor, former Minister Lee Jae-gap signed a business agreement on the 'Employment Stability Preemptive Response Package Support Project' on the 3rd at the Ulsan Metropolitan City Economic Promotion Agency with Ulsan Mayor Song Cheol-ho and others. Ulsan City formed a consortium with Buk-gu and Ulju-gun of Ulsan to participate in the public contest and was selected as a final agreement region along with consortia from Ulsan, Chungnam, Gwangju, and Busan. The Ulsan consortium will be able to invest 8.25 billion KRW this year alone to overcome the employment crisis.

Besides Ulsan, consortia from Chungnam, Gwangju, and Busan were selected as priority agreement targets. Specifically, the business plans and national funding amounts were finalized for Buk-gu and Ulju-gun in Ulsan (automobile industry, 8.25 billion KRW), Boryeong, Asan, Seosan, and Dangjin in Chungnam (coal-fired power generation, etc., 8.19 billion KRW), Buk-gu and Gwangsan-gu in Gwangju (home appliances, 8.85 billion KRW), and Sasang, Saha, and Gangseo-gu in Busan (machinery parts, 8.13 billion KRW). The plan is to create a total of 4,442 jobs: 1,215 in Ulsan, 1,101 in Chungnam, 1,016 in Gwangju, and 1,110 in Busan.

The package support project is a policy where metropolitan and basic local governments form consortia and the government supports them with 4 billion to 14 billion KRW annually for up to five years. Last year, five regions including Jeonbuk were selected, creating over 6,300 jobs. Although there was already a system for employment crisis areas, it had the limitation of providing support only after the crisis had occurred. This year, the project aims to proactively respond to the deterioration of key regional industries and job losses during the economic structural transition such as carbon neutrality, including corporate eco-friendly job transitions and package services for worker job transfers and reemployment support.

Former Minister Lee said, "The package support project is a 'mid- to long-term job project' led by the region and will play a significant role in preemptively overcoming crises tailored to local circumstances," emphasizing, "The success or failure of the project depends above all on the interest and efforts of local governments."