[2020 National Audit] Surge in Early Termination of 'Youth Employee Tomorrow Filling Deduction'... "Questioning Effectiveness"

90.4% Increase Compared to the Same Period Last Year

Source: Ministry of SMEs and Startups

[Asia Economy Reporter Kim Daeseop] The number of early terminations of the Youth Employment Tomorrow Savings Program has surged.

According to data submitted by the Ministry of SMEs and Startups to Ryu Hojung, a member of the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee from the Justice Party, the number of early terminations of the Youth Employment Tomorrow Savings Program from January to August this year reached 7,580, a 90.4% increase compared to the same period last year, while the enrollment rate decreased by 17%. This surpassed the total number of terminations for the entire last year, which was 6,936.

This year, the termination rate of the savings program reached 30.2%. Gyeongnam had the highest rate at 35.7%, followed by Gwangju at 35.1%, Seoul at 32.3%, Incheon at 31.8%, and Gangwon at 31.4%. Regarding the reasons for early termination attributable to companies, there were 1,179 cases of company-initiated resignations such as recommended layoffs, 472 cases due to economic burdens, 124 cases due to closures or dissolutions, and 297 cases for other reasons.

According to the Ministry of SMEs and Startups, the Youth Employment Tomorrow Savings Program targets young workers aged 15 to 34. When a young worker deposits 120,000 KRW per month and the employer deposits 200,000 KRW, the government provides an additional 10.8 million KRW support over the initial three years, and upon maturity at five years, pays 30 million KRW to the young worker. This program allows recipients to receive more than four times their own contributions. For males, including military service, eligibility extends up to a maximum age of 39.

Assembly member Ryu Hojung pointed out, "Contrary to the original purpose of introducing the Youth Employment Tomorrow Savings Program, the early termination rate is increasing," and added, "It is questionable whether the effectiveness of the program can be guaranteed."

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