(EDITORIAL from the Korea Herald on April 18) - Recovery and jobs

Expectations for an economic recovery are slowly rising, with President Lee Myung-bak expressing cautious confidence about it. He said earlier in the week, "Fortunately, some of the key economic indicators are sending positive signals."

President Lee shares his guarded optimism with U.S. President Barack Obama, who
said recently, "There is no doubt that times are still tough. By no means are we
out of the woods just yet. But from where we stand, for the very first time, we
are beginning to see glimmers of hope."
As a nation relying on exports to generate growth to a great extent, Korea has
every reason to welcome emerging signs of an improvement in the U.S. economy and
elsewhere. Korean exports plunged, year-on-year, 18.3 percent in February and
21.2 percent in March.
President Lee did not specify which indicators were sending positive signals. But
stocks are gaining, exchange rates are stabilizing and property markets are
shaking themselves out of a long stupor. Moreover, industrial output is starting
to rise - possibly an indication that inventory is dwindling.
But the Korean government, businesses and households should not be encouraged too
much by what may prove to be false signs of recovery from the financial crisis. A
general consensus among economic experts is that the nation has a long way to go
until the economy regains its pre-crisis vitality.
A sobering reminder of the nation's still worrisome state of economic affairs is
the worst employment situation in a decade. The number of people with jobs in
March fell by 195,000 to 23,110,000 from a year before. The job losses were the
highest since March 1999 when 390,000 jobs disappeared as manufacturers and
financial institutions laid off employees in droves in the wake of the Asian
financial meltdown.
The official number of the unemployed was at 952,000. But the de facto jobless
people were numbered at 3,440,000. They included those undergoing job training or
preparing in other ways for employment and those having given up looking for a
job.
It is not just the job losses that matter. The quality of jobs is also on the
decline. The number of full-time employees with 36 work hours or more per week
fell by 313,000, while that of those working fewer hours increased by 524,000. In
other words, part-timers are replacing full-timers.
It should not be easy to put the brakes on a rapid fall in the jobless rate if it
takes a considerable period of time until the nation's economy is "out of the
woods," to borrow Obama's words. Moreover, a recovery in employment will lag far
behind an economic recovery, given that technology-empowered growth does not
create as many jobs as labor-intensive economic advancement did.
This is not to say that the nation has nothing to do but to stand idle. Efforts
to boost employment will have to begin with the passage of a 28.9 trillion won
budget bill, in which 4.9 trillion won is earmarked to create temporary jobs for
550,000 people. The job-creation projects will have to be launched as soon as
possible because hard-pressed shipbuilding and construction companies, among
others, have started to cut their workforces as part of restructuring.
More important, a relevant law should be revised soon to extend the contractual
period of employment for irregular workers from the current two years to four
years, as proposed by the administration. Unless this problem is solved,
corporations will lay off most of the irregular workers on their payrolls when
their contracts expire in July.
Other measures need to be taken to provide unemployment insurance payments for a
longer period of time and improve job training. The government will also have to
cooperate with corporations and unions to help lessen the pain of job losses.

(END)