[Photo by Kim Jae-hoon]
Airlines, hotels and travel related businesses in South Korea that are hit the hardest by the COVID-19 crisis will be subsidized by the government to sustain payroll over the next six months.
The Ministry of Employment and Labor said Monday that it finalized the list of businesses that will be entitled to the government’s special support packages, which include travel agencies, travel service firms, hotels, resort and condos, chartered bus operators, airlines, passenger transport service operators and art and show business. Labor minister Lee Jae-kap said hotels, air carriers and travel agencies are subject to the support regardless of their business size.
The economic fallout from the new coronavirus is felt across the board but those in hospitality and travel industries bear the biggest brunt as cross-border activities came to a standstill from the pandemic.
Based on the employment insurance data as of the end of January, total 13,845 firms and 171,476 workers are expected to receive the special benefits.
The government will offer up to 90 percent of the cost a company should pay to maintain its workforce despite financial problems and temporary shutdown, up from the current maximum coverage of 75 percent. The employment retention subsidy per worker will also increase to 70,000 won ($56.42) from 66,000 won.
Workers can take out loans of up to 20 million won, up from the current limit of 10 million won, to cover their living expenses when they are not paid on time. Student loan limit increased from 5 million won to 7 million won a year and repayment period extended from five years to eight years. Jobseekers can apply for living cost loans of up to 20 million won.
The labor ministry said 13,250 firms applied for the employment maintenance grants for 118,000 workers as of Sunday. The government allocated 100 billion won for local employment subsidy from its supplementary budget implemented to offset the impact of COVID-19, but the National Assembly is mulling increasing the amount.
By Kim Tae-joon and Choi Mira
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]