facebookSouth Korea's unemployment rate unexpectedly fell in June amidst the second wave of COVID-19. What did they do differently and are there some lessons that we can learn and apply for Singapore? - Seedly

Anonymous

18 Jul 2020

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South Korea's unemployment rate unexpectedly fell in June amidst the second wave of COVID-19. What did they do differently and are there some lessons that we can learn and apply for Singapore?

What exactly contributed to their success?

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I found your question interesting so I went to read up about what South Korea (SK) is doing in response to the poor job market and how it might differ from Singapore (SG)’s efforts.

Some things to take note of:

It seems like both SK and SG experience similar trends in their sectors

For SK:

  • Sectors that were hit: Retail, lodging, restaurant, manufacturing, construction

  • Sectors that saw growth: Public service, individual enterprises, agriculture

For SG:

  • Sectors that were hit: tourism, aviation, restaurant, construction

  • Sectors that saw growth: e-commerce, pharmaceuticals, ICT

According to a Bloomberg article, there’s been improvement in consumer and business confidence, and export numbers are going up (albeit still considerably and expectedly low) for SK. As part of a New Deal project, the SK government said it would commit about 114 trillion won (about 131 billion SGD) to aid economic momentum in the next 5 years. In addition, 1.9 million new jobs, focusing on areas like technology, AI, green energy, digitisation, and the likes were promised by the government. Some examples of this effort include transforming the nation’s fossil fuel-reliant economy into an eco-friendly one, training 100,000 people in AI, building nationwide 5G networks.

I noticed similar efforts that the SG and SK government are following. Generally, both governments hope to help businesses retain workers, and upskill job-seekers to prepare them for careers of longevity.

For SG, Workforce Singapore is enhancing their reskilling programs to help current employees through enhancements ranging from extending the salary support period to making them available to more employees. With the SGUnited Traineeship program, SG hopes to offer job-seekers lower paid opportunities for them to gain experience and potentially move up to long term positions. The budget by the SG govt states that “SGUnited Jobs and Skills Package will create close to 100,000 opportunities, which includes the jobs, as well as 25,000 traineeships and 30,000 skills training placements.” The traineeships also focus on technology-related areas that are growing rapidly.

Overall, I think SG and SK are doing a decent job at curbing the issue of unemployment given the circumstances. Also, it’s worth noting that headline news shouldn’t always be taken at face value. An economics professor at Seoul’s Kookmin University mentioned that “Government incentives to prevent layoffs are what’s essentially holding together the jobs market (but) businesses may start letting more employees go should the economy slow further.”​​​

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