+ A

Gov’t economic plan may reduce jobs goal

June 26,2018
Korea’s finance ministry is expected to unveil its policy plan for the second half of the year next month with job creation targets widely projected to be cut sharply, sources said Monday.

“Economic policy plans will be announced next month, and a set of measures to boost job creation and resolve income inequality may be released as well,” an official at the ministry said, asking not to be named.

The government is expected to maintain its growth target at 3 percent for the year. But its job creation estimate is widely forecast to be cut to the 200,000-level from the present goal of 320,000.

Finance Minister Kim Dong-yeon said earlier the government has no plan to adjust its growth estimate, but hinted at trimming the job creation target.

In the first five months of the year, some 149,000 jobs were newly added, marking the lowest job creation since 2009.

A slew of private economic think tanks have lowered their own job creation forecasts to the mid-200,000 level for the year.

Also, the finance ministry is expected to roll out a set of steps to boost job creation and resolve the country’s widening income inequality.

Real household income increased sharply in the first quarter of 2018 from a year earlier, but the disparity in earnings worsened, earlier government data showed.

The average household earned 4.76 million won ($4,400) per month in the January-March period, jumping 3.7 percent from a year earlier, according to Statistics Korea. The on-year growth is the quickest since the first quarter of 2014, when the figure was 5 percent.

The monthly average income for those in the bottom 20 percent income bracket, however, dropped 8 percent on-year to 1.28 million won, the sharpest drop since 2003, when such data began to be compiled. In contrast, households in the upper 20 percent income range earned 10 million won during the first quarter, up 9.3 percent from a year earlier.

The Moon Jae-in government is seeking income-led economic growth, and widening income inequality is one of the thorny issues facing the administration.

The finance minister said if necessary, the government may examine next year’s budget and tax policy to tackle outstanding challenges.


Yonhap