The unemployed people recorded an all-time high in February due to the COVID-19 employment cold, and the unemployed increased for 10 months since May last year, when the employment shock accelerated by Corona 19. In particular, amid increasing difficulties in employment for young people, who have to enter the job market for the first time, the ruling party has been controversial as the ruling party proposed a bill to create jobs for young people by removing the’youth tax’ from companies.
According to the’February Employment Trend’ released by the National Statistical Office on the 17th, the number of unemployed in February was 1353,000, an increase of 201,000 from the same month last year. This is the highest figure as of February since 1999 when related statistics were released. The unemployment rate rose for all age groups from 20s to 60s, up 0.8 percentage points from the same period last year to 4.9% in February. In February, the number of employed over the age of 15 was 26365,000, a decrease of 473,000 from the same month of the previous year. Since the start of the Corona 19 crisis in March of last year, the number of employed has continued for 12 consecutive months, which is the longest period since the decline for 16 consecutive months from January 1998 to April 1999, at the time of the financial crisis.
As social distancing partially eased and public job vacancies filled, the decline in the number of employed in February decreased from 982,000, which was the level of’employment shock’ in January, but the employment market is still in a difficult situation. In February, the number of employed decreased, mainly in the face-to-face service industry, such as the lodging and restaurant business (-232,000 people) and the wholesale and retail business (-194,000 people). By age group, the number of employed decreased in most of the age groups in their 20s and 50s, while the number of employed persons aged 60 and over increased 212,000 as the public job program was reopened this year.
The employment deterioration of young people (15 to 29 years old) is also continuing. In February, the youth unemployment rate was 10.1%, more than twice as high as the overall unemployment rate. In particular, the extended unemployment rate of young people was 26.8%, and 3 out of 10 young people were found to be unemployed in reality. The extended unemployment rate is a figure that takes into account the number of unemployed people who are working for a short time but wants to get a job again, or who have been looking for a job but are still unable to work, and those who are not looking for a job but want a job.
In the midst of this, controversy is arising as the ruling Democratic Party, the ruling party, proposed a law to create jobs for young people by collecting more taxes from companies. Democratic Party lawmaker Jang Kyung-tae recently proposed a youth tax bill. The main idea is to impose a 1% youth tax on the amount of a corporation’s income deducted 100 million won from the tax base amount for each business year’s income. In fact, it will increase the corporate tax by 1 percentage point. Rep. Chang explained that the bill was “initiated to secure the necessary financial resources for projects to create youth jobs and improve youth’s economic and social conditions.”
However, it is pointed out that the increase in corporate taxes will reduce employment, reduce youth jobs, and negatively affect wages. Seok-jin Woo, professor of economics at Myongji University, said, “If the tax on corporations increases, the labor demand will be reduced, which means that they will not be employed as much.” “He explained. Prof. Woo said, “Taxing capital can affect not only employment reduction, but also wages,” said Professor Woo. “The current method is more effective, such as giving benefits to companies that increase employment through tax credits, etc.,” he said. He added, “The government can create jobs with finances, but rather than this, it is more important to deregulate and inspire businesses to create opportunities.”
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