South Korea focuses on job creation for 2021

One of the main aims of South Korea’s 2021 economic policy plan is to prop up the sluggish labour market.
By: | December 23, 2020

The other main goal of the policy will be to boost domestic demand to spur the economy, revealed the finance ministry. 

However, “while uncertainty over COVID-19 co-exists, the pace of recovery in consumption and job creation will likely lag behind the overall economic recovery,” said deputy finance minister Bang Ki-seon. 

The local job market has remained bleak this year, with job losses reported since March due to the pandemic. The country’s job losses were extended to a ninth month in November, the longest since the 1997-98 Asian financial crisis. 

To create more jobs, the government plans to continue its tax incentives to companies that increase hiring, and maintain support to sectors that were most affected. 

It has allocated 5 trillion won (US$4.5 billion) of the 30.5 trillion won (US$27 billion) budget to create jobs during the first quarter of next year, and plans to employ more staff in the public sector. 

In addition, another 3 trillion won (US$2.7 billion) will be deployed to support sectors and smaller merchants impacted by the winter wave of the pandemic. 

To boost domestic demand, the government plans to provide additional tax benefits over card spending. It will also maintain consumption-boosting measures, such as a cut in consumption taxes of passenger cars and refunds related to purchases of energy-efficient electronic goods. 

READ: South Korean job-creation programme favours older workers

The ministry will increase the issuance of gift vouchers and continue to hold nationwide shopping festivals to encourage consumption. It also seeks to strengthen the infrastructure of public transportation and accommodation at major tourist cities to help the local tourism industry recover, said YonHap News Agency.