The Korea Herald


1 in 4 foreign workers earn more from unemployment benefits than from work

By Song Seung-hyun

Published : Oct. 4, 2023 - 15:12

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Foreign workers are seen arriving at Incheon Airport in June. (Newsis) Foreign workers are seen arriving at Incheon Airport in June. (Newsis)

More than 1 in 4 foreign recipients of unemployment benefits received more last year in unemployment benefits than from the wages they earned before their employment ended, Ministry of Employment and Labor data showed.

According to Labor Ministry data submitted to Rep. Kim Sang-hoon of the ruling People Power Party on Wednesday, of 12,100 foreign recipients of unemployment benefits last year, 3,200 (26.4 percent) received more from the scheme than from their previous wages.

Rep. Kim expressed his concern that this situation could have unintended consequences and discourage job seekers from actively looking for their next job.

“It is necessary to examine the flaws in the system to minimize illegal leakages and ensure fairness between Korean and foreign workers,” Kim said in a statement.

Korea's unemployment benefits are typically calculated at 60 percent of an individual's average wages. However, the maximum an unemployed individual can receive is 66,000 won per day ($48.61), amounting to approximately 1,452,000 won per month. The minimum one can receive is 80 percent of the minimum wage, which currently is 9,620 won per hour.

Only full-time workers who are fired are eligible to apply for unemployment benefits, and the maximum number of days unemployment benefits can be received is 270.

The total amount of unemployment benefits received by foreign workers last year was 76.24 billion won ($56 million). Of that, 19.66 billion won was given to those who received more in the unemployment allowance than their wages, amounting to about 6.2 million won each.

Rep. Kim's office dismissed the possibility that foreign workers were more likely to receive more in unemployment benefits than they earned because of their relatively poor pay.

“We think that the data shows that the current system does not properly encourage foreign workers to seek new jobs, regardless of their wage level,” the official said.

Regarding Kim's claim that some workers of foreign nationality may be exploiting the unemployment benefit system, Korea Support Center for Foreign Workers spokesperson Lee Hyo-jung said that foreign workers should not be generalized in this way.

“Most foreign workers come to Korea on a three-year contract, and even if they are fired, they have to find a job within three months. Those who earn more from unemployment benefits than from work are probably Korean Chinese,” Lee said, referring to members of the Korean diaspora with Chinese nationality, who typically have residence visas that allow them to remain in Korea after losing their jobs.

This is not the first time that there have been claims of problems with the current unemployment benefits system and the potential of it being exploited by some foreign workers.

In August, criticism was directed once again specifically at workers of Chinese nationality in Korea.

According to data submitted to Rep. Lee Joo-hwan of the People Power Party, Chinese nationals, including ethnic Koreans, accounted for a significant share of the number of foreign national workers who applied for unemployment benefits.

Over the past five years, Chinese nationals received 266 billion won in unemployment benefits, while the amount that they paid for unemployment insurance -- which full-time workers must pay to access unemployment benefits if later fired from work -- was 187.6 billion won.