South Korea government to propose largest job-focused budget next year

14:34 | 23/08/2018 Cooperation

Finance Minister Kim Dong-yeon said Thursday that the government will propose the largest job creation-centered budget next year that will benefit both the public and private sectors, as the nation's economy is struggling with employment problems. 

Finance Minister Kim Dong-yeon speaks at a parliamentary budget committee - Photo: Yonhap

Speaking at a budget meeting with leaders of the ruling Democratic Party at the National Assembly, Kim said that Seoul plans to maintain its expansionary fiscal policy to help create jobs and narrow income inequality.

The government will expand its budget for research and development by as much as 20 trillion won (US$17.9 billion) next year, Kim told lawmakers.

Data showed South Korea created just 5,000 jobs in July, marking the lowest levels in over eight years, as the nation confronts the fallout of corporate restructuring and stagnant domestic demand. The poor showing is a hard blow to the incumbent Moon Jae-in government, which has staked its reputation on creating employment opportunities that can generate balanced and sustainable growth.

The unemployment rate stood at 3.7 percent last month, up 0.3 percentage point from a year earlier, according to the report compiled by Statistics Korea.

Last year, the government set the annual increase rate of fiscal expenditures for the 2017-2021 period at 5.8 percent.

Kim said the growth rate of next year's fiscal spending will be "sufficiently higher" than the annual increase rate.

The finance ministry plans to submit the new fiscal spending plan for 2018-2022 to the National Assembly by September.

To help bridge the income gap, the government will increase the basic old-age pension at an earlier date, Kim said.
The government will also provide more funds to self-employed business owners who face hardships after the recent increase in the minimum wage, Kim said.

Ruling party lawmakers said after the meeting that the two sides agreed to create about 15,000 teaching assistant jobs at daycare centers for children and raise the pension for the needy disabled to 300,000 won a month.

The government also agreed to set aside 20 billion won for efforts to help find low-income people jobs and 50 billion won for projects to renovate aged public rental apartments, said Rep. Kim Tae-nyeon, chief policymaker of the ruling party.

Theo Koreaherald