OPINION

[Editorial] Not all new jobs are equal

By Korea Herald

Quality of job growth must be scrutinized; short-term jobs an illusion

  • Published : Dec 13, 2018 - 17:14
  • Updated : Dec 13, 2018 - 17:20

The number of people in work rose 165,000 in November from a year ago, according to Statistics Korea.

The on-year job growth was the highest in 10 months.

It was the first time in five months that the figure topped 100,000.

But it seems difficult to see this as the beginning of a full-fledged recovery in labor market conditions. The November figure fell far short of last year’s monthly average of 325,000 and still failed to meet the government’s outlook of 180,000.

A careful analysis of the job growth is needed.

By age, it was propelled largely by those aged 65 or older and jobs in agriculture, forestry and fisheries.

The number of those aged 65 and older and employed increased by 194,000 on-year in November. It was the largest increase since related statistics were first compiled in January 1990.

This stemmed from the combination of elderly poverty with short-term jobs the government created.

Agriculture, forestry and fishery jobs increased last month by 81,000 from the same month last year. This seems to have been much influenced by an increase in the number of people returning to farming and fishery.

More troubling is that the manufacturing industry lost 91,000 jobs in November. It was more than double 45,000 jobs that vanished a month earlier.

Manufacturing jobs are deemed desirable for economic growth. Job losses in this sector indicate a weakened momentum for growth and also reflect an ongoing jobs crunch for young people. The numbers of those employed in their 30s and 40s fell last month by 98,000 and 129,000, respectively, from a year ago.

Wholesale and retail industries lost about 69,000 jobs. Considering jobs in these industries are strongly influenced by the minimum wage, a change to the government’s minimum wage policy is urgent.

By industry, jobs increased the most in public health and social welfare services, which gained 16,400 jobs. The services are publicly financed. Jobs are sustained with taxpayer money. The more jobs, the heavier the burden on taxpayers. The government must check whether it considered economic conditions and avoided welfare populism in increasing spending on these services.

It is hard to deny that job growth last month was boosted by the execution of government budget to create short-term jobs.

In late October, the government announced a plan to create 59,000 short-term jobs in the public sector by the end of this year.

Short-term jobs have been created by provincial governments and public institutions at the urging of the central government. They created jobs for the sake of job creation, and recruited interns to do the jobs, which amounted to little more than time-killing errands. In some cases, wages were said to have been paid to interns who had nothing to do.

These kinds of jobs are of no practical help in improving the employment situation. They are nothing but a means to inflate job numbers.

The Ministry of Employment and Labor unveiled a plan to increase the number of short-term public-sector jobs to 960,000 next year. It says it will spend 3.8 trillion won ($3.38 billion) to do so.

The ministry cannot avoid criticism that it is trying to improve the employment statistics, not the employment situation.

This is a waste of money.

Creating short-term jobs with taxpayers’ money will certainly help increase the quantity of jobs, but it can create a statistical illusion and disorient economic policymakers.

To propel job growth along the right path, policymakers should study an array of factors, sifting out the trickier ones and specially tailoring the measures.

It is the worst of all policies to mass-produce short-term jobs using taxes.

Job problems must be tackled at source. They cannot be resolved merely by easing the symptoms.

Real jobs can be created by companies when they increase investment.

The administration must try to listen to businesses and deregulate corporate activities as much as possible to spur investment.