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What dreams may come

If young Koreans have hope in the future, they can settle for a pitiful paycheck for now.
Mar 23,2018
Mr. Jeong quit his job at a big company last year. He became fascinated with the blockchain technology he came across at work and started his own business with three acquaintances. His parents and others tried hard to talk him out of the huge risk he was taking. He poured his severance pay and all his savings into the business. He works almost 24 hours. But he has never been happier because he now has a dream.

The government unveiled another package to create jobs for the young — the 22nd set of measures since 2008. It aims to take preemptive action before the already thin job market is joined by people in their 20s.

The latest measures, however, are more or less recycled material. The government proposes a subsidy of up to 10,350,000 won ($9,707) annually for any person under the age of 35 who gets a job at a small and mid-sized company, over the next four years. It hopes to solve a labor shortage at small and mid-sized companies and ease youth joblessness at the same time.

But the government is foolish to think that young people are shunning jobs at smaller companies because of poorer pay. Go to any industrial complex. To watch a movie, one has to go to a bigger city or Seoul. There are no decent cafés on the streets. Asking young people who prize leisure as much as work to live in such a suffocating environment is preposterous.

Moreover, the perk is temporary. When annual compensation is reduced by more than 10 million won after working for a company for four years, one would hardly want to stay longer. What about the sense of unfairness among young people who had been hired by the same workplace prior to the new measure?

The government will be eligible to get a Nobel Prize in Economics if it can generate more than 180,000 new hires through the four-year plan, as it claims. All other administrations since 2008 have pumped out one measure after another, but none made much difference. Why? The young are not just looking for money. They want hope and dreams. If they have hope in the future, they can settle for a pitiful paycheck for now. They won’t care if they have to work overtime.

What the government must do is to build an environment where young Koreans can spread their wings and demonstrate their potential. Pampering them with subsidized salaries can only kill their potential. In 2004, a start-up in partnership with LG Electronics developed a Bluetooth-enabled diabetic pack that can send blood test results through a smartphone to a doctor. The development was hyped as a sensation that would accelerate the adoption of telemedicine. But its developer, now called Osan Healthcare, saw its technology go down the drain because the government disallowed the device because of a regulation that places phone packs for blood measurement under the category of medical equipment, not telecommunications.

The Moon Jae-in administration regards cryptocurrency and blockchain technology — which are about to become central to the fourth industrial revolution — as frauds. In Japan, over 260,000 shops accept payments in cryptocurrency. Nomura Securities estimated that Japan’s gross domestic product would add 0.3 percentage point thanks to the cryptocurrency industry. Switzerland is turning into a crypto hotbed with 32,000 enterprises flocking to Zug, a village with a population of 120,000, after it became a hub for initial coin offerings (ICOs), the equivalent of initial public offerings (IPOs) in the non-crypto business world.

Regulations by government offices are forcing hundreds of young Koreans to yield their dreams and waste their innovative ideas. A survey showed that out of 100 global ventures, 57 would not have started business if they had been based in Korea. Finland’s economy contracted for four consecutive years after Nokia went under in 2012. But the government encouraged Nokia engineers to start businesses. Since then, Finland’s economy gained life. Instead of grinding the same mill, the Seoul government must think in new ways if it really wants to create jobs and add vitality to the business community.

JoongAng Ilbo, March 22, Page 28

The author is a senior editor of business and industry news at the JoongAng Ilbo.

Jung Kyung-min