[THE INVESTOR] The Korean government said Friday that it will offer financial subsidies for young people actively looking for a job, in partnership with the state-run Youth Hope Fund, overturning its initial stance that handing out “cash” could create “moral hazards.”
The Ministry of Employment and Labor will offer funds of up to 600,000 won ($544) over three months to help job seekers cover expenses when attending job interviews under the program called “Successful Job-landing Package,” Labor Minister Lee Ki-kwon said at a news briefing at Seoul Government Complex.
The ministry explained that it drew up the measure as many job seekers find it difficult to go through the job searching process due to lack of cash.
The announcement came amid mounting controversies over the Seoul Metropolitan Government’s implementation of the “Youth Allowance.” The Ministry of Health and Welfare has been opposing the program, ordering the city government to cancel the project and take back the money already distributed to 2,831 applicants.
In what many see as a similar program, the municipality provides 500,000 won per month for up to six months to some 3,000 selected young people, who have lived in Seoul for more than a year, work less than 30 hours a week and are aged between 19 and 29.
The Labor Ministry, however, drew a clear distinction between its scheme and Seoul City’s version.
“It is serious that youth looking for a job give up on taking part in job interviews due to financial difficulties,” the minister said.
“But Seoul City’s ‘Youth Allowance’ would rather take away job opportunities (from the young) because it does not set the young’s participation in job searching efforts as a precondition,” he said.
“The Seoul’s plan also broadly acknowledge individual activities unrelated to finding employment, it is highly probable that youth are just settled for cash subsidies rather than actively look for a job.”
Lee also said that some 35 people applied for Seoul City’s “Youth Allowance” instead as the ministry-led job support program does not offer expenses.
The Seoul Metropolitan Government welcomed the Labor Ministry’s plan.
“As the central government rolls out a measure that is rarely different from Seoul City’s policy, the Ministry of Health and Welfare should withdraw its decision to cancel ‘Youth Allowance’ program,” an official from Seoul Metropolitan Government said. “We will cooperate with the central government if there are common grounds.”
Under the current program, job seekers received cash in the first and second stage of their nine-month-long job consulting program encompassing counselling, vocational training and internship. The new measure will allow job seekers to cover expenses to attend job interviews across the country.
Counsellors at job centers will draw up the list of job seekers entitled to receive the allowance and the Youth Hope Fund will offer the fund to selected candidates. It will take effect in September.
The unemployment rate for people between the ages of 15 and 29 stood at 9.2 percent in August.
By Ock Hyun-ju/The Korea Herad ()
