COVID-19 Impact... Employees Suffering from Job Insecurity Due to Layoffs

Economic Downturn and Prolonged Employment Shock
Government to Make All-Out Efforts to Maintain Jobs

The economy is deteriorating due to the impact of the novel coronavirus infection, leading to employment shocks.
Photo by Yonhap News

[Asia Economy Reporter Han Seung-gon, Intern Reporter Kang Joo-hee] As the economy worsens due to the impact of the novel coronavirus disease (COVID-19), the employment shock is also becoming prolonged. Consequently, office workers are expressing anxiety about the possibility of being laid off due to business deterioration.

A man in his 20s, identified as Mr. A, who works at a small or medium-sized enterprise, said, "Recently, due to the impact of COVID-19, the company has been struggling, and I have been on unpaid leave for over a month," adding, "I am managing to get by with disaster relief funds, but it is uncertain when I will return to work, so I feel at a loss about what to do going forward."

Mr. A revealed, "The company is already accepting applications for voluntary retirement," and said, "At first, I thought the situation would be resolved quickly, but recently, confirmed cases are rising again. If this situation continues, I might never be able to return to the company, which makes me anxious."

According to a survey conducted on the 29th by the employment portal JobKorea targeting 2,385 office workers in their 30s and 40s on the 'Status of Resignation Anxiety,' 76.4% responded that they think they might suddenly have to resign due to recent company circumstances. In contrast, only 23.6% answered 'No.' This means that more than seven out of ten office workers feel anxious about resignation due to the COVID-19 situation.

In particular, among sales and service workers who are directly affected by contact avoidance and social distancing measures due to COVID-19, 81.0% reported feeling anxious about resignation, the highest proportion.

Mr. B, a man in his 20s working at a clothing store in Gangnam, said, "Since the outbreak of COVID-19, the number of customers visiting the store has decreased, and sales have dropped sharply," adding, "Because the store's situation is bad, employees now take turns working every other week while resting on alternate weeks. Naturally, salaries have dropped by nearly half."

Mr. B said, "As sales have fallen and it has become difficult to cover the store rent, there have even been talks about closing the store entirely," adding, "Sales have slightly improved compared to the early days of the COVID-19 outbreak, allowing us to barely operate, but if the situation worsens, we don't know when we might have to close the doors."

As the novel coronavirus infection (COVID-19) prolonged, the number of workers in domestic businesses in April this year showed the largest decrease ever recorded. Photo by Yonhap News

As COVID-19 prolongs, the number of domestic business workers in April this year has decreased to the largest extent ever recorded. According to the April 2020 Business Workforce Survey results announced by the Ministry of Employment and Labor on the 28th, as of the last business day of last month, the number of workers employed at businesses with one or more employees was 18,224,000, a decrease of 365,000 (-2.0%) compared to the same month last year.

This is the largest decline since the government began employment statistics in June 2009. The unemployment rate is also rising due to the impact of COVID-19.

In the political sphere, there have been calls to suppress layoffs and maintain employment to stabilize jobs shaken by COVID-19.

On the 28th, Lee Nak-yeon, Chairman of the COVID-19 National Crisis Overcoming Committee of the Democratic Party of Korea, said at the policy forum 'Job and Employment Measures and Prospects in the COVID Era,' "According to one statistic, the number of employed people decreased by more than one million in just two months after the COVID-19 outbreak," adding, "We must first suppress layoffs and maintain employment."

He continued, "During the past global financial crisis, companies refrained from layoffs, and workers suppressed wage increases. This time, a grand compromise for mutual growth between labor and management is needed," he emphasized.

The government has expressed its commitment to making every effort to maintain jobs.

On the 29th, Lee Jae-gap, Minister of Employment and Labor, said at the 'Meeting of Heads of Public Institutions under the Ministry of Employment and Labor,' "It is difficult to predict how much greater the employment shock will be and when we will emerge from this dark tunnel," emphasizing, "In this emergency situation, the core task we must focus on is 'protecting jobs.'"

He added, "Through the 'Employment Crisis Response Team,' which involves 14 ministries, we are making every effort to protect jobs. Starting next week, we will begin accepting applications and distributing emergency employment stabilization funds," which is a system that provides up to 1.5 million KRW to special-type workers, freelancers, and unpaid leave workers.

The minister also added, "From next year, we will implement the National Employment Support System, known as the second employment safety net, to provide customized employment services to low-income job seekers, youth, and small business owners, thereby enhancing the safety net level."

This content was produced with the assistance of AI translation services.