In the aftermath of the 1997 Asian Financial Crisis, representatives from government, business and labour in Korea (‘Tripartite Commission’) established the Social Pact for Job Creation, which was a basket of social, economic and industrial policies meant to foster growth.
Some examples of the recommendations, which came in four broad categories, include the following:
- the investment- promoting policies included less regulation, business-friendly taxation, financial assistance for small- and medium-sized enterprises and government funding for vocational training and job-placement services;
- the employment security and inequality-reducing measures included minimizing dismissal, job sharing, good faith bargaining with unions, the reduction of two-tier compensation for ‘irregular’ workers, a reduction in the costs of private education and an expanded social safety net;
- measures to increase employment included public sector job creation in social services (partially aimed at youth unemployment) and a doubling of the length of paid maternity leave;and
- measures to stabilize industrial relations included an end to illegal political funding by employers and a commitment by management and labour to negotiate agreements within the confines of the law.
Check out: OECD Economic Surveys: Korea 2004