Job market blues in South Korea

South Korea's 2008 employment prospects are gloomy, as indicated by a recent survey of the 400 largest corporations in the nation.

According to the survey, 161 corporations are planning to add 24,765 people to their payrolls, which is down 6.3 percent from last year. The others have yet to finalize their recruiting plans.

The survey results, however, do not give the whole picture. Many agree, given the worsening global economic conditions, South Korea's growth rate will fall below 5 percent this year.

Under current labor market conditions, an additional 1 percent growth rate is estimated to create 57,000 to 690,000 new jobs. South Korea needs 400,000 new jobs each year if it is to stabilize its job market, which means it has to generate a 6 percent or higher growth rate.

Is it impossible to create as many jobs as are needed, just because South Korea cannot generate as high a level of growth as desired? Not necessarily. By making their labor markets more flexible, some European countries maintain higher employment-to-population ratios, though their growth rates are lower than South Korea's.

The country should abolish the seniority-based pay system, and allow the value of a job to be determined by the market.

It should also make working hours more flexible. This merits serious consideration, given that the fixed workweek, together with the inflexible weekly working hours, have been a major barrier to the employment of women and young folk.

The Korea Herald/ Asia News Network

SOURCE: China Daily