Time to focus on improving income, welfare benefits
The number of irregular workers, including day laborers, part-timers and outsourced workers, totaled about 8.06 million in August, according to Statistics Korea. There were 6.57 million irregular workers in 2017 when the Moon Jae-in administration took office, but the number has swollen by 1.5 million over four years. Considering that one of the government's key policies was turning irregular workers into regular employees, the results are somewhat paradoxical. The total number of wage earners also increased 540,000 this year, but the share of irregular workers rose 2.1 percentage points from last year to 38.4 percent.
Thanks to the government's aggressive push to convert part-time workers into full-time employees, more than 200,000 public-sector workers saw their wages and welfare benefits improve. However, this only resulted in money from taxes being funneled into securing their employment. Private-sector employers were less than enthusiastic about changing the status of their irregular workers to regular ones from the start. Moreover, the steep rise in the minimum wage and the outbreak of COVID-19 forced many employers to trim payrolls. The statistical agency's latest report shows the result.
All of this reveals the limitations of the government's taxpayer-funded job-creation policy. Policymakers should figure out why the private sector avoids hiring regular workers. Given that individual companies' employment environments vary widely depending on their corporate characteristics, eliminating irregular workers is neither possible nor even reasonable. If the government keeps pushing to remove irregular workers without rectifying the job market's dual structure, it could further fuel polarization among salaried employees. Nothing displays this better than the gap of 1.56 million won ($1,330) between the monthly pay of regular and irregular workers in the previous quarter, the widest since 2004.
The Moon government should not adhere to increasing the number of regular workers but switch to a policy of narrowing the gap in pay and other benefits between regular and irregular workers. The problems to address are how to provide more decent jobs and improve the work environment for low-wage workers. The administration, of course, needs to tackle the problem of irregular workers' job insecurity, however, it should solve this by strengthening vocational training and policies to incentivize employers to keep employees on the payroll, while expanding the social safety net.
The number of irregular workers, including day laborers, part-timers and outsourced workers, totaled about 8.06 million in August, according to Statistics Korea. There were 6.57 million irregular workers in 2017 when the Moon Jae-in administration took office, but the number has swollen by 1.5 million over four years. Considering that one of the government's key policies was turning irregular workers into regular employees, the results are somewhat paradoxical. The total number of wage earners also increased 540,000 this year, but the share of irregular workers rose 2.1 percentage points from last year to 38.4 percent.
Thanks to the government's aggressive push to convert part-time workers into full-time employees, more than 200,000 public-sector workers saw their wages and welfare benefits improve. However, this only resulted in money from taxes being funneled into securing their employment. Private-sector employers were less than enthusiastic about changing the status of their irregular workers to regular ones from the start. Moreover, the steep rise in the minimum wage and the outbreak of COVID-19 forced many employers to trim payrolls. The statistical agency's latest report shows the result.
All of this reveals the limitations of the government's taxpayer-funded job-creation policy. Policymakers should figure out why the private sector avoids hiring regular workers. Given that individual companies' employment environments vary widely depending on their corporate characteristics, eliminating irregular workers is neither possible nor even reasonable. If the government keeps pushing to remove irregular workers without rectifying the job market's dual structure, it could further fuel polarization among salaried employees. Nothing displays this better than the gap of 1.56 million won ($1,330) between the monthly pay of regular and irregular workers in the previous quarter, the widest since 2004.
The Moon government should not adhere to increasing the number of regular workers but switch to a policy of narrowing the gap in pay and other benefits between regular and irregular workers. The problems to address are how to provide more decent jobs and improve the work environment for low-wage workers. The administration, of course, needs to tackle the problem of irregular workers' job insecurity, however, it should solve this by strengthening vocational training and policies to incentivize employers to keep employees on the payroll, while expanding the social safety net.
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