South Korea lost 195,000 jobs in March compared to the same month last year. Experts have forecast a reduction in employment but March’s job loss was bigger than expected. It was the biggest monthly drop in 11 years since 240,000 jobs were lost in May 2009, immediately after the global financial crisis. The employment market in April is also set to be worsened due to the impact from COVID-19.
Reviving the economy and boosting domestic demand are the only ways to improve the employment rates. Injecting cash into the market could be one way to boost consumption, thereby promoting the domestic economy. But more fundamental and effective way would be easing regulations that have stood in the way of businesses.
During a meeting with his secretaries and aides on Monday, President Moon Jae-in said that jobs are at the center of reviving the economy from the beginning till the end, instructing his staff to come up with measures to help workers at risk of losing their jobs maintain their employment. In addition to an emergency aid package, the Moon administration should build up a policy that can secure employment and even create jobs after the crisis.
But some of the economic pledges by the ruling Democratic Party of Korea have been found to be worrisome. The Dong-A Ilbo has analyzed the ruling party’s economic plans together with six economic organizations — the Korea Chamber of Commerce and Industry, the Federation of Korean Industries, the Korea Employers’ Federation, the Korea International Trade Association, the Korea Federation of Small and Medium Business, the Federation of Middle Market Enterprises of Korea and. According to the analysis, the opening and sales restrictions plan on shopping mall complexes, which is the number one pledge by the ruling party and its satellite Together Citizens’ Party, might have succeeded in earning votes but could bring about an adverse effect on boosting the domestic economy.
Furthermore, laws and regulations that have been justified as a means to realize “fair economy” could hinder free business activities and stymie job creation. They are not the right policy measures to implement when the economy is struggling as now. More than anything else, the focus now should be on reviving the economy and creating jobs
Responsibilities have become heavier for the government and the ruling party after the recent general elections. Welfare policies alone, such as emergency aid package cannot add jobs. All focus now should be on easing regulations in the healthcare and service industries and stimulating corporate investment in order to create a large number of jobs that will fundamentally boost domestic demand.