[End of Employment Retention Subsidy] Aviation and Transportation Workers "Survival Threatened if Support Ends"

Ahead of the End of Special Employment Support Designation in Late March, Workers Feel Anxious
"Please Allow Moonlighting to Maintain Livelihood"

[Asia Economy Reporters Hyunji Kwon and Gyumin Oh] Choi Young-gil (49), who works in in-flight meal transportation for airlines, has been receiving furlough pay for two years due to his company's closure amid the COVID-19 pandemic. The allowance is about one-third of his original monthly salary, amounting to 1 million KRW. Supporting a family of four, this is far from sufficient, so he sought other work, but he faces difficulties because he can only earn money within the government-supported furlough pay limit, known as the Employment Retention Subsidy.

Since the COVID-19 outbreak, the hardships of workers in ‘special employment support industries’ such as aviation have not eased. It is difficult to find jobs, and the government’s Employment Retention Subsidy, which underpins furlough pay, is set to end in March. If workers cannot find other jobs after March, maintaining their livelihoods will become extremely challenging. To make matters worse, government support policies have focused on self-employed individuals and small business owners, leaving these workers effectively in a blind spot.

According to the Ministry of Employment and Labor’s ‘Establishment Labor Force Survey’ on the 13th, the number of workers who left their jobs due to unpaid leave or other reasons in the air transportation industry was only 166 in February 2020, just before the COVID-19 outbreak, but surged to 13,933 in May of the same year. Since then, until October last year, an average of 10,000 workers per month have been effectively unemployed.

The situation in the land transportation industry is even more severe. The number of involuntary job leavers due to restructuring, layoffs, or management leave reached a two-year high of 8,563 in October last year.

Although more than 10,000 people are classified as effectively unemployed in these industries every month, government support is nearing its end. The government has designated 14 industries, including tourism transportation, travel, buses, and performance arts, as ‘special employment support industries’ and compensates part of the furlough pay through the Employment Retention Subsidy, but the validity period is set to expire in March.

If these industries are excluded from the special employment support category, the employment retention effect provided by the subsidy may disappear, and unemployment rates could soar. Choi Young-gil sighed, saying, “After March, I think I will have to live without pay.”

Many workers have no choice but to find other jobs to make ends meet because furlough pay is insufficient. Choi, who is on leave from a highway bus company, said, “Furlough pay does not cover living expenses,” adding, “Most people are doing ‘two jobs’ discreetly.”

Some say that receiving furlough pay is still better than nothing. Kim Gye-wol, who was laid off without the company applying for the Employment Retention Subsidy, said, “Furlough pay is like a pie in the sky.” Kim, who was responsible for aircraft cabin cleaning, lost his job due to COVID-19 and received unemployment benefits, but when those stopped, he had to support himself directly.

Workers in these industries emphasize the need for measures such as extending support for special employment support industries. If companies are excluded from this category, they will not receive incentives such as increased furlough pay compensation or extended support periods, which could reduce the allowances workers receive. Choi Young-gil said, “Everyone is struggling due to COVID-19, but it would be good if the support could be extended once more within budget limits.”

There is also a call to raise the individual limit on the Employment Retention Subsidy. Workers in special support industries can receive up to 70,000 KRW per day for unpaid leave through the subsidy, which is far from enough to live on. The subsidy limit also becomes a barrier when seeking other jobs. The government prohibits earning beyond the subsidy cap. If increasing the subsidy is difficult due to fiscal constraints, these workers want to raise the cap to increase additional income. A representative from a low-cost carrier (LCC) said, “Even if employees earn more from other work, they can only receive furlough pay up to the subsidy limit,” adding, “Employees are left with the choice of either giving up the subsidy entirely and changing jobs or not taking on additional work and only receiving the subsidy.”

Employers are also demanding improvements to the system. Many companies hesitate to apply for the Employment Retention Subsidy because of the burden on employers, even if they want to increase its use. Lee Tae-hee, head of the Smart Jobs Division at the Korea Federation of SMEs, said, “Even if companies receive the Employment Retention Subsidy, there is still a portion of the cost borne by the company, so companies in difficult situations feel burdened to apply.”

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