Job market set for further contraction
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Job market conditions are set to deteriorate next month when about 500,000 college seniors graduate, joining the ballooning army of Koreans on the hunt for jobs, data showed yesterday.
The job market for the age bracket of 20-29 is already thin, the data showed, as companies refrain from hiring this year, hit by a sharp economic slowdown.
According to the National Statistical Office, the employment rate for those in their 20s stood at 57.8 percent in December, the lowest since May 1999, when the country was reeling from the Asian financial crisis.
The labor force participation rate for the age group stood at 61.9 percent, the lowest since February 1988.
"The February employment data is going to be very bad because about 500,000 college graduates are to squeeze into the already-tight job market," an official at the Finance Ministry said yesterday.
The Korean government is going all out to protect and create jobs, but more jobs are being erased than being created, as the nation faces a double whammy of lethargic domestic consumption and plummeting exports.
The economy lost 12,000 jobs in December from a year ago, the first decline in five years. The number of employed people came in at 23.25 million last month, according to the NSO.
A recent survey conducted by Korea Employers Federation found that 61.1 percent of its member companies plan to reduce this year's new recruitments from a year earlier.
President Lee Myung-bak weighed in on the situation last week.
"I believe we should think of ways to promote job-sharing by cutting wages," the president said.
"The most urgent issue is to create jobs for the heads of households."
Various incentives are being studied in order to encourage businesses to cut or freeze salaries instead of firing workers, government officials said.
Still, experts see a turnaround unlikely as a high tide of corporate restructurings hit industrial sectors, threatening to erase more jobs.
A government-led restructuring is under way in the local construction and shipbuilding sectors. State-owned companies and agencies will unlikely boost new hirings, as they come under increasing pressure from the government to slim down its organization and cut costs.
According to the Bank of Korea yesterday, Korean corporate bankruptcies rose to their highest level in almost four years in December as the nation headed for its first recession since 1998.
Ssangyong Motor Co., 51 percent owned by China's SAIC Motor Corp., applied for court protection on Jan. 9 in Seoul as plunging vehicle sales caused a serious liquidity crisis.
Hynix Semiconductor, the world's second-biggest maker of memory chips, said last month it would eliminate 30 percent of its executives. Hyundai Motor Co. and Kia Motors Corp. have reduced their employees' working hours.
By Lee Sun-young
(milaya@heraldm.com)
Job market conditions are set to deteriorate next month when about 500,000 college seniors graduate, joining the ballooning army of Koreans on the hunt for jobs, data showed yesterday.
The job market for the age bracket of 20-29 is already thin, the data showed, as companies refrain from hiring this year, hit by a sharp economic slowdown.
According to the National Statistical Office, the employment rate for those in their 20s stood at 57.8 percent in December, the lowest since May 1999, when the country was reeling from the Asian financial crisis.
The labor force participation rate for the age group stood at 61.9 percent, the lowest since February 1988.
"The February employment data is going to be very bad because about 500,000 college graduates are to squeeze into the already-tight job market," an official at the Finance Ministry said yesterday.
The Korean government is going all out to protect and create jobs, but more jobs are being erased than being created, as the nation faces a double whammy of lethargic domestic consumption and plummeting exports.
The economy lost 12,000 jobs in December from a year ago, the first decline in five years. The number of employed people came in at 23.25 million last month, according to the NSO.
A recent survey conducted by Korea Employers Federation found that 61.1 percent of its member companies plan to reduce this year's new recruitments from a year earlier.
President Lee Myung-bak weighed in on the situation last week.
"I believe we should think of ways to promote job-sharing by cutting wages," the president said.
"The most urgent issue is to create jobs for the heads of households."
Various incentives are being studied in order to encourage businesses to cut or freeze salaries instead of firing workers, government officials said.
Still, experts see a turnaround unlikely as a high tide of corporate restructurings hit industrial sectors, threatening to erase more jobs.
A government-led restructuring is under way in the local construction and shipbuilding sectors. State-owned companies and agencies will unlikely boost new hirings, as they come under increasing pressure from the government to slim down its organization and cut costs.
According to the Bank of Korea yesterday, Korean corporate bankruptcies rose to their highest level in almost four years in December as the nation headed for its first recession since 1998.
Ssangyong Motor Co., 51 percent owned by China's SAIC Motor Corp., applied for court protection on Jan. 9 in Seoul as plunging vehicle sales caused a serious liquidity crisis.
Hynix Semiconductor, the world's second-biggest maker of memory chips, said last month it would eliminate 30 percent of its executives. Hyundai Motor Co. and Kia Motors Corp. have reduced their employees' working hours.
By Lee Sun-young
(milaya@heraldm.com)
Labels: Job Market, Korea
