Despite the Corona 19 pandemic, the economy is cruising at the beginning of the year as exports, the backbone of the Korean economy, are showing strong performance.
If the current trend is the same, optimism is gaining momentum that there will be no problems with achieving the GDP growth forecast of 3.1%, which was proposed by the International Monetary Fund (IMF) last month, or 3.0%, the forecast of the Bank of Korea last November. .
However, as the face-to-face service industry was shocked by the extreme sluggish consumption and jobs were reduced, the general public is not feeling the warmth that the economy is reviving.
The dominant outlook is that the K-shaped polarization of booming exports and shrinking domestic demand will be difficult to improve.’ Concerns about employment-free growth are becoming a reality.
◇ Exports fly far, but… Realization of employment-free growth
According to the Korea Customs Service on the 15th, exports (according to customs clearance) on the 1st to 10th of this month were $18 billion, an increase of 69.1% from the same period last year. The daily average export value, reflecting the number of working days, increased by 39.3%. Exports of its flagship items, semiconductors (57.9%), wireless communication devices (88.0%), passenger cars (102.4%), auto parts (80.6%), and petroleum products (37.5%), increased sharply.
Exports were strong last month as well. January exports amounted to 48.01 billion dollars, up 11.4% from the same period last year, and the average daily export value, taking into account the number of working days, increased by 6.4%. January exports were the second in history (as of the same month).
“Exports are better than expected and domestic demand is below expectations, but the overall economic flow is going to the level expected in November last year (a growth rate of 3.1%),” said KDI’s Director KDI Economic Outlook Office.
There is also a prospect that if the corona does not get worse and the economy moves in this trend, the 3.2% government set for this year’s growth rate target could be achieved. As of the end of last month, the average of global investment banks (IB)’s growth rate forecast in Korea has risen to 3.5%.
But the job was dry. This is because the face-to-face service industry, which has a large employment-inducing effect, is hitting a direct hit with prolonged social distancing and mass-producing the unemployed. The change in industrial structure following the technological revolution is also a bad thing for jobs.
The employment shock in January caused by the government’s fiscal job mismatch (the number of employed decreased by 982,000) will be resolved to some extent over time, but it seems difficult to reverse the fundamental trend.
The prospects for hiring professionals are grim. As a result of a recent survey of 20 economists by KDI, the number of employed is expected to increase by 50,000 this year. It is a major retreat from the forecast of 180,000 increase in the survey in October last year. This is half of the estimates for KDI (an increase of 100,000 people) or the Bank of Korea (an increase of 130,000 people).
Despite the base effect, as the number of employed people declined 218,000 amid negative growth last year, it is virtually unemployed growth if the number of jobs increases by only 50,000 with a growth of 3% this year.
◇ President Moon ordered emergency measures for jobs
It seems that the government will take off its feet to overcome this situation. President Moon Jae-in said at a meeting of chief and advisors on the 15th, “Please take extra measures with extraordinary determination to go beyond the planned employment countermeasures in the face of a previous employment crisis.” President Moon also said, “When the private sector is difficult, the government has no choice but to welcome you, but the full recovery of employment must be done in the private sector.”
As President Moon ordered’emergency additional employment countermeasures’ and’active support for job creation by private companies’, the government is also expected to start preparing special countermeasures. Deputy Prime Minister Hong Nam-ki recently said, “We will take full action by putting the highest priority on maintaining employment and providing direct job opportunities, strengthening protection for people outside the job market, and promoting jobs in the private sector.”
First, the government decided to strengthen public sector jobs by providing 900,000+α direct jobs in the first quarter. However, although it is true that fiscal jobs can help improve employment, it is difficult to become a fundamental solution to the job problem. As President Moon mentioned, the proper recovery of employment should be done by private companies. Therefore, it seems that employment measures should focus on attracting private investment along with government fiscal expenditure.
Experts ordered that the speedy promotion of government stimulus measures such as the Korean version of the New Deal should stimulate private investment while dramatically improving the regulatory environment that is holding back startups and business activities.
Shin Min-young, head of SMB Investment Partners’ Economic Research Institute, said, “It will not be easy to increase jobs in a short period due to economic conditions, but it is also helpful to create jobs by launching the Korean version of the New Deal, which the government has deliberately planned, and speeding up the 2-4 housing supply measures. “It can be.” He said, “Amid the paradigm shift of the industry, the types of jobs are also changing,” he said. “In order to create employment, we must secure the flexibility of the labor market.”
Professor Sung Tae-yoon of Yonsei University’s Department of Business Administration also emphasized that “for face-to-face service businesses and small and medium-sized enterprises, it is urgent to apply the minimum wage or working hours according to the type of business, and various regulatory reforms to induce a virtuous cycle of investment and employment must be preceded.” .
[ⓒ 세계일보 & Segye.com, 무단전재 및 재배포 금지]
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