South Korea has moved to moderate the outsized growth in the public sector under President Moon Jae-in’s job policy led by the public sector due to swelling dent on the financial balance in state enterprises.
The Ministry of Economy and Finance tightened the recruitment guidelines in public enterprises after encouraging them to increase hiring over the last three years.
The move comes after sharp deterioration in the financial statements of enterprises under state management and funding.
Government data show that the number of public sector jobs, combining permanent and part-time positions, reached 446,000 last year, up by 70,000 from 2016 or before President Moon took office in May 2017.
Public organizations added 8,000 some permanent workers in the first three months of this year.
Meanwhile, the combined net income of 340 public sector companies came to 600 billion won ($488.9 million) last year, decreasing 100 billion won from a year earlier. The result is the lowest since 1.8 trillion loss recorded in 2012.
The typical case was Incheon International Airport Corp., the operator of the country’s main air gateway, where irregular workers were first to put on permanent payroll.
The company’s net profit shrank to 860 billion won in 2019 from 1.1 trillion won in 2018. It spent 157.0 billion won on payroll last year, up 70 percent from three years ago.
The airport operator is expected to fall into the red this year for the first time in 17 years as the coronavirus pandemic has stopped nearly all air travel.
By Yang Yeon-ho and Cho Jeehyun
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]