Job Sharing

It's Time to Build Social Consensus to Share Pains

Job creation is a key element in tiding over the unprecedented global financial and economic crisis. But it's getting more difficult to create jobs with the economy sinking deeper into recession. It's inevitable that more and more people will lose work, hit hard by the worst crisis since the Great Depression.

Now, the government is spearheading a ``job sharing'' program to avoid mass layoffs and offer employment. The move is comparable to the gold collection campaign in which tens of thousands of South Koreans participated to raise funds needed to overcome the 1997-98 Asian financial crisis. Current economic conditions are much more serious than the previous turmoil. Thus, it's urgent to ensure job security and expand the social safety net to help those in need.

In fact, job sharing is an alternative to the active creation of jobs in the face of the worldwide financial turbulence and its effect on the real economy. Job sharing can send a message of hope to employers and employees, but it requires workers to endure a cut in pay to enable their firms to go without layoffs or hire more workers without additional labor costs.

It's not easy for workers to come to terms with income reduction under the job-sharing framework. All economic players must come to a consensus on the issue. The cause of sharing jobs cannot be easily translated into action without any incentives for employers and employees.

For now, the public sector is taking the initiative to promote job sharing. The government plans to hire 11,000 interns, including 5,640 for local authorities. About 100 state-run enterprises are seeking to cut initial wages by up to 30 percent this year to hire more workers. Incheon International Airport Corp., Korea Asset Management Corp., and Korea Housing Finance Corp. have decided to slash starting salaries by 30 percent. Korea Export Insurance Corp. and Korea Electrical Safety Corp. plan pay cuts off 25 percent and 15 percent, respectively.

The private sector has also acknowledged the need for job sharing. Some banks and corporations are active in hiring interns and new workers in return for lowering wages of executives and existing workers. But many firms are still reluctant to adopt the job-sharing program due to worries of a possible fall in productivity and competitiveness, as well as disputes with unions. Thus, it's necessary for the government to offer various incentives to employers and workers for their participation in the program.

On Feb. 12, the government announced a plan to provide tax benefits to firms implementing the job-sharing scheme. Tax breaks will be available for companies taking part in the scheme by writing off 50 percent of reduced wages as expenditure. But the benefits are not enough to encourage more firms to follow suit. Therefore, the government should consider providing financial support for workers to make up for their pay cuts. What's more important is that the government, business and labor should reach a grand social compromise to share the pain and share the jobs.