The Korea Herald

소아쌤

Korea behind OECD average in job security

By Kim Yon-se

Published : Dec. 8, 2014 - 21:25

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South Korea lags behind major members of the Organization for Economic Cooperation and Development in job security for regular employees in the private sector, the Paris-based organization said Monday.

An OECD report showed that Korea posted 2.17 in the index for employment protection last year, under the average of 2.29 for the global entity’s 34 member countries.

Korea ranked 22nd in the regular job security comparison, while Germany topped the list with 2.98, followed by Belgium with 2.95, the Netherlands with 2.94, France with 2.82 and Italy with 2.79.

Korea also fell short of Portugal (No. 7 with 2.69), Slovenia (No. 8 with 2.67), the Czech Republic (No. 9 with 2.66), Mexico (No. 10 with 2.62), Turkey (No. 12 with 2.47), Greece (No. 15 with 2.41), Poland (No. 16 with 2.39) and Slovakia (No. 20 with 2.26).

The index ranges from zero (free dismissal of workers) to six (the strictest restriction on layoffs).

Further, South Korean firms are more active in layoffs in times of financial distress.

The country posted 1.88 in the redundancy layoff index, which means Korean businesses were more active in workforce reductions when their financial soundness was weak. The figure was lower by 1.03 percentage points than the OECD average of 2.91.

The OECD report suggested that the comparison indicates that Korea is one of several countries with lax state regulations on the business sector’s retrenchment. In contrast, most OECD countries’ firms were placed under tougher oversight from authorities in the dismissal when they underwent financial turmoil.

As an example, Japan posted 2.09 in the overall job security index, while the country saw its redundancy layoff index reach 3.25.

Meanwhile, another OECD report showed that it is more difficult for contract workers in Korea to become permanent employees than it is for those in other countries to make the same transition.

An OECD report on the upward mobility of workers said that as of 2013, only 11.1 percent of Korean nonregular workers were hired for regular positions after a year, and 22.4 percent after three years.

The proportion of a job status transition after three years of work is less than half the OECD average of 53.8 percent, which put Korea at the bottom of the list for long-term employment security and upward mobility in the job market.

This means that in most OECD countries, more than half of workers are elevated to regular staff after three years’ service as temporary workers. “Nonregular jobs serve as stepping stones to permanent ones in major industrial countries,” a local labor researcher said.

By Kim Yon-se (kys@heraldcorp.com)