[3rd Supplementary Budget] "Protecting Jobs..." Half of the Ministry of Employment's 6 Trillion Won Budget Goes to 'Unemployment Benefits'

Ministry of Employment's Supplementary Budget Includes 3.4 Trillion Won for Job-Seeker Benefits
Job-Seeker Benefit Payments Expected to Approach 1.3 Billion This Year
Focus on Income Support for Unemployed and On-Leave Workers Rather Than Employment Retention

On the 12th, an unemployment benefits briefing session was held for the unemployed at the Seoul Employment Welfare Plus Center in Jung-gu, Seoul. Due to the economic downturn caused by the novel coronavirus disease (COVID-19) crisis, the employment shock has intensified, and the amount of unemployment benefits paid in April reached 993.3 billion won, setting a record high. The number of new job-seeker benefit applicants increased by 32.9% (32,000 people) compared to the same month last year, reaching 129,000. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Kim Bo-kyung] Although the government has put its life on the line to 'protect jobs' amid the COVID-19 pandemic, the budget for employment retention subsidies included in the 3rd supplementary budget is only about one-quarter of the budget for job-seeking benefits (unemployment benefits). The additional budget secured for job-seeking benefits through the 3rd supplementary budget amounts to 3.4 trillion won, while the budget for employment retention subsidies is only 850 billion won.

On the 3rd, the government held a Cabinet meeting and resolved to prepare a 3rd supplementary budget worth 35.3 trillion won. Among this, the budget under the Ministry of Employment and Labor is 6.4337 trillion won. The Ministry of Employment and Labor's supplementary budget projects are broadly classified into three categories: ▲special employment stability measures in response to COVID-19 ▲support for the Korean New Deal ▲prevention of accidents in high-risk industrial sites.

The item with the largest budget allocation among the 3rd supplementary budget projects is job-seeking benefits, with 3.3938 trillion won allocated. This amount can support an additional 490,000 unemployed people. Combined with the main budget of 9.5158 trillion won, the total approaches 13 trillion won. The government emphasized employment retention with the motto "protect even a single job," but the actual budget is concentrated on income compensation for the unemployed.

There are two main reasons for the significant expansion of the job-seeking benefits budget. First, the monthly payment amount and the number of recipients of job-seeking benefits have recently reached record highs due to COVID-19. The payment amount for job-seeking benefits in April surged by 34.6% (255.1 billion won) compared to the same month last year, reaching 993.3 billion won, nearly 1 trillion won. Since last October, the unemployment benefit payment level was raised from 50% to 60% of the average wage, and the payment period was extended from 90?240 days to 120?270 days, which also had a significant impact.

Besides job-seeking benefits, the 3rd supplementary budget also focuses on income compensation and loans for the unemployed and those on leave. 570 billion won will be invested in the 'Emergency Employment Stability Subsidy,' which provides up to 1.5 million won to special-type workers (special employment types), freelancers, and small business owners whose income or sales have decreased. In addition, budgets were allocated for ▲support loans for vocational training living expenses for unpaid leave workers and special-type workers amounting to 96.3 billion won ▲living stabilization funds (loans) of 100 billion won ▲living stabilization funds for long-term unemployed of 2 billion won.

Although the government has declared it will make every effort to maintain employment, the related budget is far less compared to job-seeking benefits. In this supplementary budget, 850 billion won was allocated for employment retention subsidies for companies maintaining employment through paid or unpaid leave. The plan is to support an additional 578,000 workers on leave. Furthermore, a new project was established with a budget of 95.2 billion won (covering 1,300 workplaces) to provide employment retention fund loans to workplaces unable to pay leave allowances, and 35 billion won (covering 466 workplaces) will be invested in a project that supports up to 50% of wage reductions for six months if labor-management agreements on employment retention are concluded.

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