KoreaToday Private Tutoring, Jobless Youths Troubling Lee
By Na Jeong-ju
Staff Reporter
President Lee Myung-bak faces daunting tasks to win broader public support for his pet projects, such as the refurbishment of the country's four major rivers, as rival parties are gearing up for the June 2 local elections.
Analysts say growing household spending on private education and youth unemployment are the two biggest challenges the conservative leader must tackle this year to stabilize the livelihoods of ordinary people.
Lee's ongoing ``people-first'' policies reflect a growing sense of crisis in the administration over a weakening base of support for his major policies, which critics say mainly serve the needs of the rich and big businesses.
As the local elections, which are considered a confidence vote on Lee, draw near, some ruling party lawmakers caution that Lee may become an early lame duck if opposition parties prevail in the polls.
The country's worsening fiscal health is also a headache.
Officials forecast the multi-billion-dollar river project and the state-led corporate restructuring will erode fiscal soundness in the coming years.
In the lead-up to the elections, the administration may turn to various populist policies to appeal to a broader base of voters, putting the administration under a tighter budget, critics say.
``The rising state debt may hamper the country's efforts to spur economic growth,'' said Ahn Jong-beom, a professor at Sungkyunkwan University. ``Beginning this year, the government will increase spending on large-scale engineering projects. It will surely ease financial troubles in large firms, but it is doubtful whether ordinary citizens will benefit from it, too.''
According to the Ministry of Strategy and Finance, government debt is expected to rise above 400 trillion won, or some 40 percent of the annual gross domestic product, this year from 366 trillion won in 2009.
It means the government must pay nearly 20 trillion won, or 400,000 won per each South Korean, in interest to cover the snowballing debt in 2010.
The presidential office said it has been a shared goal among senior officials to increase the number of middle-income earners and strengthen the social safety net for less privileged citizens.
``The allegations that the government is working only for the rich are not true,'' presidential spokesman Park Sun-kyoo said. ``We are trying to serve the needs of all classes of people. We've always kept the ordinary and underprivileged people in mind.''
In the coming months, President Lee will increase meetings with opinion leaders from all social sectors in order to reflect their opinions better in state policies, he said.
Lee has repeatedly called for ``centrist pragmatism'' to embrace different ideological and social groups and promote policies for middle-income earners and less-privileged people.
Lee's aides believe Lee's public approval rating will remain above 40 percent, even after the local elections, thanks to the people-first policies.
Educational Reform
In recent weeks, he has made a series of remarks on educational reform as corruption among education officials and teachers as well as violent behavior by students have made headlines here.
During a Cabinet meeting in early March, Lee said reforming the sector was the No. 1 issue for his administration this year.
``The country's future will be bright only after we complete educational reform now. Educational fundamentals should be improved so that all people, rich or poor, can get quality services,'' Lee said.
The country's spending on private schooling, including tuition costs for private cram schools and expenses on study materials, have grown by some 20 percent annually.
According to the National Statistical Office, total household expenditure for children's private education rose to 21.6 trillion won in 2009 from 18.7 trillion won a year earlier, with each family spending on average 2.1 million won.
According to the latest data on public education costs from the Organization for Economic Cooperation and Development (OECD), Korean parents are spending the most on their children among the 26 member countries surveyed.
Their spending accounted for 2.9 percent of GDP in 2006, compared with the OECD average of 0.8 percent.
The government's expenditure on public education, however, stood at 4.3 percent of GDP, lower than the OECD average of 5 percent, indicating Korean parents are depending heavily on private tutoring due to their dissatisfaction with public education.
With regard to soaring youth unemployment rates, President Lee has repeatedly said he put policy priority on creating more job opportunities for young people.
Korea has emerged as one of the fastest recovering economies in the world over the past year.
But its employment market continues to remain in a slump, preventing low- and middle-income households here from enjoying the ongoing rebound.
To improve the livelihood of working families and promote economic recovery, the government has placed top policy priority for 2010 on creating more jobs, according to presidential aides.
Jobless Youth
Government agencies have hired college graduates as interns or short-term contract workers, but many of them quit early due to low salaries and poor working conditions.
In a bid to ease youth unemployment, the government plans to send nearly 160,000 young South Koreans abroad for occupational training and volunteer services over the next five years. It also seeks to send about 60,000 young Koreans to 13 countries worldwide by 2012 under working holiday programs. South Korea has signed working holiday agreements with Japan, Canada, New Zealand, Australia and France that can benefit about 30,000 youths annually.
Despite such measures, the country's youth unemployment has become a greater social concern.
In 2009, Korea sustained its largest loss of jobs since the 1997-98 Asian financial crisis, with many businesses downsizing their workforce. The number of workers stood at 23.51 million last year, down 72,000 from 2008, the largest decrease since the nation saw 1.28 million positions disappear in 1998, according to Statistics Korea.
The number of jobless came to 834,000 in 2009, up 48,000 from 2008, with the jobless rate jumping from 3.3 to 3.5 percent.
But in reality, some 3.3 million Koreans are ``practically jobless,'' with many giving up looking for work, or studying and undergoing vocational training for employment amid the tight job market.
To address the problem, the government has decided to provide small businesses with tax breaks and other incentives if they hire full-time employees through the first half of 2011, while expanding state job-hunting services and building a more extensive employment database.
As part of mid- and long-term measures, it plans to turn the nation's increasingly technology- and capital-intensive economic structure into one that generates more jobs, advances the services industry, improves labor market efficiency and nurtures a talented workforce.
The government will also provide larger research and development funds to ``low-carbon, green growth'' sectors, create a more business-friendly environment, nurture parts and material industries, and root out chaebol's unfair practices against small firms.
Presidential aides said this year's G20 summits, slated for Toronto in June and Seoul in November, will tackle the issue of the sluggish job markets around the world as a key agenda item.
``It is not the government, but enterprises that provide jobs. The government should only play its part to assist them,'' Lee said.
To cope with the projected labor shortage in the future as a result of the country's rapidly aging population and low birthrate, the government will make efforts to bring more foreign workers into the country.
It also plans to take a host of steps to bolster the competitiveness of leisure, tourism and other services industries to ease the tight labor market, while administering an array of effective vocational training programs tailored to specific occupations.
``This year, the government will continue a range of taxpayer-funded projects to employ a total of 580,000 people in various public services areas,'' said a spokesman from the Ministry of Knowledge Economy. ``We will also construct a more extensive employment data network to better help employers and job seekers.''