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W O R K I N G P A P

28 Dec 2020

cial Crisis had far more serious and extensive ripple effects Under such economic situations, this paper aims to re- than the Global Financial Crisis of 2008-2009 in terms of solve the impending economic crisis caused by COVID-19 the depth of economic downturn, the decline in the num- based on the analysis of how the employment crisis un- ber of employed persons, the rise in unemployment, and fold. [...] Also, thanks to the restructuring of insolvent compa- During the Global Financial Crisis of 2008-2009, the nies led by creditors as part of the prompt execution of government, the business community, the labor and man- restructuring policies, corporate default rates were lower agement organizations quickly made themselves ready to in the period of 2008-2009 than in 1998. [...] These economic outlooks indicate that the impact of the In May 2020, the number of employed persons decreased employment crisis due to the COVID-19 economic crisis by 390,000 compared to the same period last year, and the will be deeper and longer-lasting than the 1997-98 Kore- number of the temporarily laid-off also rose by 680,000 an Financial Crisis, raising the need to be prepared for it. [...] Such a move can be evaluated as contributing to preventing the spread of fears in the la- Reinforcing the social safety net will be the most im- KLI WORKING PAPER 12 portant task in order to establish the first line of safety of wage replacement rate, etc.) and 2) areas that need to net for the unemployed and the vulnerable, ensuring the be continuously improved after the economic crisis (ex- stab. [...] Also, in order to strengthen the social safety such matters as the method of identifying the potential net through the expansion of employment insurance cov- beneficiary’s income, the adjustment of contribution rate, erage and the introduction of the sickness benefit system, and the payment criteria of employment insurance, etc.
Pages
14
Published in
South Korea