More self-employed let go part-timers

Korea’s small business owners carried out massive layoffs of their employees, mostly part-timers, in August, to survive the nation’s stagnant economy, a study revealed Tuesday.

Despite the ever-worsening job market, however, the government is reiterating its blind optimism that the country’s employment had hit rock bottom and is now getting better.

According to a study released by Statistics Korea, the number of small business owners in the country totaled 6.79 million in August, down 62,000 from a year ago.

Of them, the number of small business owners with employees reached 1.53 million, down 116,000 from a year ago during the same period.

In contrast, the number of self-employed people with no employees or single-person businesses totaled 4.12 million accounting for 60.7 percent in August. The number climbed by 97,000 from the same period last year.

The data indicates an increasing number of small business owners fired their employees, due to the nation’s sluggish economy.

“I and my wife used to hire a couple of part-timers. We let them go, and are working together to reduce operating costs. My daughter helps us once every three days,” said a convenience store owner surnamed Lim in Jung-gu, central Seoul.

“It’s a busy district with a lot of office workers, so I think we can stay in business for a while. But, I know convenience stores’ turnover rate is continuously growing, especially in bed town districts in Seoul. Anything could happen here. We won’t hire any part-timers in the near future.”

The Statistics Korea study also suggests the number of the nation’s economically inactive population stood at 16.33 million as of the end of August, up 158,000 from a year ago.

Despite a series of skeptical indicators, the government claimed the nation’s employment situation has “hit rock bottom and started improving.”

Experts said the government should be alerted over the recent development in Korea’s job market.

“It’s clear the Moon Jae-in administration is not doing a very good job of creating quality jobs,” said Hyundai Research Institute President and CEO Lee Dong-geun.

“The government shouldn’t discourage firms’ entrepreneurship. Instead, it should come up with measures to get rid of regulations.”

Yonsei University economist Kim Jung-sik agreed.

“The risks are clearly there,” he said.

“A number of indicators suggest the current situation of self-employed workers as well as small- and medium-sized enterprises is worth monitoring. I strongly believe Korea’s economy is following the passage toward a Japan-like long-term recession.”