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Government budgets, legislation and policies to be designed and administered in "job-centered" way

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Aug. 8, 2017


The Presidential Committee on Job Creation decided on a plan to set up a job-centered national administration system at its second meeting held at the Government Complex in Seoul on August 8th (Tue.).


In relation to the agenda item mentioned above, the Ministry of Employment and Labor (MOEL) announced measures to expand and strengthen employment impact assessment across all state affairs including budgeting, policy-making and legislation and to innovate the system of managing government-funded job programs.


《Strengthening employment impact assessment》

  The main contents include:

 ▴ largely expanding employment impact assessments of budget projects and tightening the link between assessment results and actual budgets;
 ▴ conducting employment impact assessments of main industry-specific policies and encouraging employment-friendly policy improvements; and
 ▴ introducing assessments of the employment impacts of enacted or amended legislation.



Employment impact assessments will be used as an important budgeting yardstick  and expanded and strengthened across all state affairs from major policy-making to legislation.


[Budget projects] Employment impact assessments of budget projects, which have been conducted on a pilot basis since 2016, will be extended to more than 1,000 projects next year and to all budget projects in the future.


* all government-funded job programs and R&D, SOC and public procurement projects worth 10 billion won or more


When allocating its budget, the government will give higher priority to projects which would have a larger employment effect per one billion won of budgetary cost according to assessment results.


As the scope of projects subject to assessment is set to be expanded, MOEL plans to put the Employment Impact Assessment Center (currently under the Korea Labor Institute (KLI)) fully in charge of calculating employment effects, which have been calculated by each competent government agency so far, to reduce the burden for government agencies.


It also said that a consultative body composed of relevant government agencies and research institutions* will be created to improve the employment effect calculation technique in a consistent and elaborate manner.


* [government agencies]MOEL, Ministry of Strategy and Finance, Ministry of Science and Technology, Ministry of Trade, Industry and Energy, Ministry of Gender Equality and Family[research institutions]KLI (Employment Impact Assessment Center), Bank of Korea, KDI,  Korea Institute for Industrial Economics & Trade, Korea Employment Information Service, etc.


[Major policies] The employment effects of major industry-specific policies will be assessed, and based on the results, individual government agencies will be encouraged to pursue employment-friendly policies.


The involvement of government agencies, labor and management and industry circles in the entire assessment process will be expanded. A joint research team will be created among research institutions to increase assessment accuracy and strengthen the assessment of employment quality (employment types, wage levels, gender, etc.).


Moreover, a standard assessment manual will be developed by the consultative body, and meta-assessments (aimed at evaluating the adequacy of assessment) will be made periodically to consistently complement the assessment techniques and control the quality of assessment. 


And a real name system that requires assessors to offer their real names when assessing the employment impacts of budget projects and major policies will be introduced to make assessments more objective.


MOEL also said that it will provide support, such as offering consulting services and building a database of assessment results, to ensure that assessment results can lead to actual policy improvements.


[Introduction of employment impact assessment in legislative process] In cases where legislation is enacted or amended, what impact the legislation would have on employment will be examined.


Each competent government agency will examine the employment effects that would be brought about by the enactment or amendment of legislation, using a checklist.


This system will be designed in such a way that in the case of legislation which would have a huge negative impact on employment, improvements to such legislation are recommended after in-depth analysis by experts.


Meanwhile, it will be ensured that legislation with a great job-creation effect can be examined speedily by the Regulatory Reform Committee and the Ministry of Government Legislation. 


Every year an employment impact assessment plan and its implementation results will be reported to the Presidential Committee on Job Creation, thereby ensuring continuous review of the employment impact assessment system.

《Innovating the system of managing government-funded job programs》

 The main contents include:
 ▴streamlining job programs implemented separately by government agencies and local governments and coming up with a system of reflecting their employment effects and outcomes (employment rate, etc.) in budgets;
 ▴establishing a quality control system for vocational training and employment services; and
 ▴strengthening field-level monitoring and outcome evaluation.



The system of managing government-funded job programs into which the central and local governments inject about 20 trillion won a year will be drastically overhauled.  


* Government-funded job programs refer to those programs which support directly or indirectly job creation and job security for vulnerable groups, such as long-term unemployed people, with government spending.


①direct job creation (provision of temporary work experience and income support), ②vocational training (enhancement of the employability of unemployed or employed people), ③employment services (provision of information on job openings and job seekers and job placement services), ④employment subsidies (subsidies for hiring, employment security, etc.), ⑤start-up support, ⑥income during unemployment (unemployment benefits, etc.)
[Problems] There have been too many job programs with central government agencies operating 185 programs in 2017 and local governments operating 4,186 programs in 2016, and similar or overlapping programs have been implemented separately by different government agencies and regions.


As a result, it has been hard for people who want to participate in job programs to know when and where to apply, and government-wide quality control for vocational training and employment services has been insufficient.


The employment rate of participants in direct job creation programs has been low, and many participants have repeatedly participated only in job programs. This implies that direct job creation programs have failed to play their role in helping their participants move to private-sector jobs.


It has also been ceaselessly pointed out that there is a lack of monitoring of how job programs are executed at the field level and that the jobs budget is spent carelessly because program outcomes are not tied to budgets. 


[Reform measures] Every year the government will come up with a plan to streamline government-funded job programs, considering the employment effects and outcomes of all job programs. According to the plan, it will streamline job programs by merging or abolishing similar or overlapping programs and allocating differentiated budgets based on outcomes.


Local governments will reorganize similar or overlapping programs among them through the job creation divisions of the wide-area local governments (i.e. upper-level local governments) and strengthen their overall management function, for example by adjusting and operating central government agencies' programs in a way that meets their local circumstances.


The way programs are operated and their contents will also be reformed to allow people to participate in job programs timely and easily when necessary.


▴ The government will give an integrated notice of 50 direct job creation programs (in 2017) and receive applications for participation through Work-Net to increase their accessibility. It will also strengthen the link between vocational training and employment services to enable program participants to be promptly employed in private-sector jobs. 


▴ Government-wide quality control for employment services and vocational training will be largely enhanced so that people can receive high-quality services. 


* [employment services] The 'employment service quality center' (tentative name) will be created to establish standard service certification criteria.[vocational training] The 'national HRD council' (tentative name) will be created to discuss training programs across all government agencies, and a system of managing vocational training outcomes across all government agencies will be set up.


In addition, field-level monitoring and program outcome evaluation, whose aim is to check how job programs are executed at the field level, will be greatly strengthened.


   ▴ The Employment Policy Monitoring Team (KEIS) will promptly identify difficulties in the program execution process and causes of budget wastage and notify competent government agencies of those difficulties and causes to address them.
▴ Individual job programs will be graded, comprehensively taking into account their employment effects (jobs created per one billion won spent) and outcomes, and will be budgeted according to their grades.

Last Modifide Date   :   Fri September 8, 2017
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