By Lee Hyo-sik
Staff Reporter
The nation's top economic policymaker said Wednesday that Korea should make an all-out effort to make its labor market more flexible in order to achieve an efficient allocation of human resources and bolster economic growth.
In an economy-related ministers' meeting at the Gwachon Government Complex, south of Seoul, Strategy and Finance Minister Yoon Jeung-hyun stressed the importance of a supple labor sector, saying it was as important as achieving job security for Korean workers.
``Job market flexibility will improve the allocation of manpower and stimulate economic activities, helping create more jobs and raise wages. The government will try to make the labor sector more flexible, while strengthening the social safety net and other state support programs for the unemployed and job seekers,'' he said.
The minister then said lowering an entry barrier to a range of services sectors will also help make the job market more flexible, adding it will intensify competition and increase labor productivity, generating greater wealth for employees and their families.
Touching on economic conditions at home and abroad, Yoon said the global economy has begun showing signs of a rebound on the easing of the international financial market debacle, but warned against outright optimism.
``The consensus is that the U.S. and other advanced economies have bottomed out and resumed an ascent. The pace of the economic downturn has slowed and stock markets across the globe are staging strong rallies, raising expectations for a marked economic rebound,'' the minister said.
``But the recent U.S. recovery has largely been supported by massive government spending, not by private sector activities. Chances are that corporate investment and private consumption will continue to remain in a slump,'' he added.
Given the high U.S. unemployment rate and continued job losses, he said private spending in the world's largest economy will likely stay stagnant for the time being. ``We should closely monitor these and other external factors in the second half to more effectively steer the country toward a full-scale recovery.''
On the domestic front, the minister issued a more positive assessment, saying industrial output here has expanded for the sixth consecutive month through June on a quarter-to-quarter basis, with investment and consumption showing signs of a pickup.
``It is encouraging to see that many large businesses are moving to invest more in renewable energy development and other green growth sectors in line with improving economic conditions. The government will provide tax incentives and other support to stimulate more corporate investments,'' Yoon said.