Hyundai Motor Group to adopt wage peak system in 2016

Hyundai Motor Group, the world's No. 5 auto giant, said Tuesday it will implement a wage peak system groupwide starting in 2016 in line with government calls to tackle South Korea's high youth unemployment.

The new wage system calls for extending the retirement age to 60 en bloc and the costs saved from the policy implementation will be used to create more jobs for young adults.

"The decision was made in order to increase the recruitment of young people and meet social expectations for improving the country's overall job security," Hyundai Motor Group said in a press release. "We will also push ahead with expanding employment by hiring 1,000 additional young workers per year."

The business group added that it will begin negotiations with the respective labor unions of each affiliate regarding the details of the implementation.

The South Korean government has been encouraging both private and public firms to create new jobs for the youth by 2017 and to permanently increase employment opportunities for young adults.

Earlier last week, South Korea's finance minister urged public corporations to adopt a wage peak system by the end of this month to help young people find jobs.

The country's jobless rate for those aged between 15 and 29 came to 10.2 percent as of end-June, up 0.9 percentage point from the previous month, according to government data. The overall unemployment rate edged up 0.1 percentage point to 3.9 percent over the cited period. (Yonhap)