Youth employment fund
Efforts should focus on creating more jobs
President Park Geun-hye has demonstrated her commitment to increasing the country’s youth employment by pledging to give 20 percent of her monthly salary each month -- on top of a 20 million won ($17,000) initial donation -- to an envisioned fund meant to help young people find jobs. Her monthly contribution will amount to about 3.4 million won, given that her annual salary is set at 205 million won this year.
Disclosing the president’s decision Wednesday, Prime Minister Hwang Kyo-ahn said he and other Cabinet ministers as well as heads of public organizations would also make donations to the tentatively named Youth Hope Fund. Hwang said efforts would be made to induce voluntary contributions from a broad range of sectors.
A day earlier, Park proposed to establish a fund to help provide young people with more job opportunities.
Her initiative may be partly aimed at making the atmosphere conducive for persuading unionized workers to accept the introduction of the wage peak system and other measures to reform the labor market. But it seems doubtful that the envisioned fund will be of substantial help in resolving the youth unemployment problem.
The unemployment rate for people aged 15-29 stood at 8 percent in August, down from 9.4 percent a month earlier. The slight improvement came as more students did part-time jobs during the summer vacation.
The government budget for this year has set aside 1.8 trillion won to finance programs designed to increase jobs for young people. But these programs have proved mostly inefficient in improving youth employment. Most of the jobs created by them have fallen short of matching expectations of young, educated job seekers.
It is likely that programs to be offered by the envisaged fund will make little difference with those funded by the state budget.
Needless to say, the most effective and fundamental solution to youth unemployment is to reinvigorate the economy so that corporations will increase investment and employ more workers. Government policymakers need to focus on labor reforms and deregulation to help create more business-friendly conditions.
Park’s initiative will inevitably result in nudging corporations to make their own contributions to the planned fund. This may result in reducing the room for companies employing more workers in a way that fits their management conditions.
If the government pushes to launch the fund despite these cautious views, it should draw up specific programs that could bring tangible results before undertaking the fund-raising campaign in a full-fledged manner. It is also necessary to ensure that a foundation planned to be set up by the end of the year to manage the fund will be run by qualified private experts free of influence from government officials.
Prime Minister Hwang said the government would make utmost efforts to give much hope to young people through the fund. What is equally or more important for keeping young job seekers from falling into frustration and cynicism is to ensure fairness, objectivity and transparency in the recruitment process both at public organizations and private companies.
In this regard, it is deplorable that a public corporation was recently found to have fabricated scores and changed screening rules to hire an unqualified applicant in 2013. The applicant worked as an intern at the constituency office of Rep. Choi Kyung-hwan, who now serves as deputy prime minister for economic affairs. Choi has denied exercising his influence over the recruitment process. He should fully cooperate with the prosecution’s investigation to clear suspicion surrounding him. Otherwise, the government’s efforts to provide more job opportunities for young people would seem just hollow.
