[2022 Budget] Ministry of Employment Cuts Maintenance Support Fund by Half but Still Records 'All-Time High' 36.5 Trillion

856.6 Billion KRW (2.4%) Increase Compared to This Year

Employment Retention Support Fund Cut by More Than Half from 1.4 Trillion to 0.6 Trillion KRW
Carbon Neutrality-Induced Industrial Restructuring Severance Support Also Allocated

Increase in Employment and Industrial Accident Insurance Funds... 10% Rise in Industrial Accident Fund

[Image source=Yonhap News]

[Sejong=Asia Economy Reporter Moon Chaeseok] The Ministry of Employment and Labor announced on the 31st that the total expenditure for next year's budget and fund plan will be 36.5053 trillion KRW, an increase of 856.6 billion KRW (2.4%) compared to this year. Although the employment retention subsidy, a temporary support project for COVID-19, was cut by more than half, the overall budget increased due to labor cost support focused on small and medium-sized enterprises and the expansion of nationwide employment insurance. In preparation for a large-scale structural adjustment centered on high carbon-emission industries such as coal power and automobiles due to rapid industrial restructuring for 2050 carbon neutrality, a budget for worker job transition support was also allocated.

The budget expenditure combining the general account and special accounts increased by 0.8%, from 7.0672 trillion KRW in this year's main budget to 7.1237 trillion KRW. Fund expenditures, including employment insurance and industrial accident insurance, increased by 2.8% during the same period, from 28.5815 trillion KRW to 29.3816 trillion KRW. The employment insurance fund increased by 19.7 billion KRW (0.1%) from 18.8443 trillion KRW to 18.8640 trillion KRW. The industrial accident insurance fund increased by 771.2 billion KRW (9.5%) from 8.099 trillion KRW to 8.8702 trillion KRW.

Source=Ministry of Employment and Labor

The Ministry of Employment and Labor plans to implement the 'Youth Job Leap Incentive' project targeting 140,000 young people starting next year, allocating a budget of 500 billion KRW. This is a labor cost support policy that provides up to 9.6 million KRW per person for one year when small and medium-sized enterprises with five or more employees hire young workers. The number of beneficiaries for the Youth Tomorrow Savings Program will be reduced from 100,000 this year to 70,000 next year. The budget was also cut from 1.4 trillion KRW to 100 billion KRW.

The employment retention subsidy, which was paid to industries severely affected by COVID-19 such as the aviation sector, was cut by more than half from 1.4 trillion KRW to 600 billion KRW. A budget of 500 billion KRW was allocated for job stability funds for small business owners to provide additional support for six months this year.

To prepare for digital and low-carbon industrial restructuring, a new 'Labor Transition Support Project' was established. This is part of the Human New Deal policy, one of the three pillars of the Korean New Deal. If employers provide job transition support services to workers who want to change jobs, the government will add up to 3 million KRW per person. Additionally, if labor and management sign an employment stability agreement, an employment stability agreement support fund will be provided. Furthermore, funds will be provided to apply 'specialized training for industrial structural change response' for 25,000 people and a long-term paid leave policy for job transition support for 10,000 incumbent workers.

Support policies for nurturing talent in new technology fields such as artificial intelligence (AI) and software (SW) will be strengthened. The target for 'K-Digital Training' support will increase from 17,000 this year to 29,000 next year. In this regard, the Polytechnic is launching a new 'AI+x (AI technology convergence) talent development' program and plans to establish 10 new departments related to low carbon and other fields. To nurture high school graduate talent, related departments will be significantly increased from 8 this year to 48 next year.

The number of job seekers eligible for job support policies, excluding the Tomorrow Learning Card which provides up to 5 million KRW per person for vocational training expenses, will expand from 40,000 to 75,000, and the related budget will double from 20 billion KRW to 40 billion KRW. This includes support policies such as 500,000 KRW for basic digital training and 1 million KRW for career planning expenses per person.

In addition, social insurance premium support will be expanded for 430,000 temporary and daily workers in small workplaces. The related budget will double from 800 billion KRW this year to 1.6 trillion KRW next year. Nationwide employment insurance for 12 special employment types (SETs) such as insurance planners, the launch of the Occupational Safety and Health Headquarters, and policies to prevent industrial accident deaths under the Serious Accident Punishment Act will continue to be promoted.

In particular, to reduce industrial accident deaths, a new budget of 327.1 billion KRW was allocated in next year's budget for support to improve aging and hazardous processes in small and medium manufacturing businesses. Also, the budget for major accident prevention items related to manufacturing and construction industries, such as system scaffolding, will increase from 94.3 billion KRW to 119.7 billion KRW.

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