South Korea plans to spend 11.2 trillion Korean won ($10 billion) on a fiscal stimulus package that would boost social welfare spending and the public payroll.
South Korea’s new government announced a 11.2 trillion won ($10.00 billion) fiscal stimulus package on Monday, increasing social welfare subsidies and taking the first steps to deliver on President Moon Jae-in’s key election promise – to create 810,000 public sector jobs.
The stimulus package allocates 5.4 trillion won to create public sector and social services jobs, including places for fire fighters, teachers and postal workers, the finance ministry said.
Another 2.3 trillion won will be used to provide subsidies for maternity leave and for elderly people needing medical care.
The government estimates the extra spending will boost economic growth by 0.2 percentage point this year, which may raise its 2017 outlook from the current 2.6 percent.
It expects to the extra budget to add 71,000 jobs to the public sector workforce and 15,000 jobs to the private sector.
“This is the first supplementary budget for jobs purposes, ” Park Chun-sup, South Korea’s chief of budget, told a news conference.
“There are concerns over mass job losses…10 years ago youth unemployment used to be double the overall jobless rate of 3.5 percent, but now it is three times as high, ” Park said.
Unemployment among those aged 15-29 soared to 11.2 percent in April, even though the economy posted the fastest growth in six quarters in the January-March period.
