The designation period for Yeosu, a city in South Jeolla Province facing a downturn in the petrochemical industry, as an employment crisis response area will be extended for one year. Dangjin, a city in South Chungcheong Province, has been newly designated as a response area due to job losses primarily in the steel and metal product manufacturing sectors.
On August 20, the Ministry of Employment and Labor held the 6th Employment Policy Council of 2026, chaired by Minister Kim Young-hoon, where the designation of employment crisis areas and response areas was discussed and approved.
The employment crisis response area system was introduced in July of last year to provide government support before employment shocks from industrial downturns are reflected in statistics. Areas are designated if the number of insured workers in key industries declines for three consecutive months compared to the same month the previous year, or if a leading company plans to restructure more than 10% of its regular workforce.
Although Yeosu did not meet the criteria for designation as an employment crisis area, the ongoing struggles in its key petrochemical industry led to an extension of its response area designation until August 27 of next year. This follows its initial designation on August 28 of last year, resulting in a one-year extension of support.
Dangjin has been designated as a response area from August 21 to August 20 of next year, considering the job losses in the steel and metal product manufacturing sectors.
This inclusion of Dangjin, which is heavily reliant on the steel industry, follows the ongoing restructuring in Yeosu's petrochemical sector. The policy aims to prevent the downturn in manufacturing from impacting the local job market.
In total, eight areas have been designated as response areas, including Gwangsan District in Gwangju, Pohang in North Gyeongsang Province, Seosan in South Chungcheong Province, Nam-gu in Ulsan, Gwangyang in South Jeolla Province, and Jemulpo District in Incheon.
Being designated as a response area allows for expanded support, including employment maintenance subsidies, vocational training, and livelihood stability assistance. If employers provide paid leave and maintain employment, the government’s support ratio increases from the usual 50-66% to 60-80%.
The support limit for the National Tomorrow Learning Card has been raised from 3 million won to 5 million won over five years, with the self-burden rate reduced to 0-20%. The limit for vocational training living expense loans has increased from 10 million won to 20 million won, and the limit for livelihood stabilization loans has risen from 20 million won to 25 million won.
During the council meeting, recent employment conditions and response strategies were also discussed. Last month, the number of employed individuals increased by 108,000 compared to the same month last year, but the employment rate for those aged 15 and older fell by 0.1 percentage points to 63.3%. The youth employment rate dropped by 1.6 percentage points to 44.2%, and declines in employment in manufacturing and construction sectors continued.
In response, the government plans to expand youth work experience programs and establish the 'K-New Deal Academy,' along with a new 'Youth First Employment Support System (K-Youth Guarantee).' For middle-aged individuals, the government will gradually expand mandatory re-employment support services and provide career transition support linked to training and work experience.
The council also discussed evaluations and improvement plans for this year's publicly funded job projects. The government will consider the evaluation results of 188 publicly funded job projects from last year to reform low-performing projects and coordinate similar and overlapping initiatives.
Additionally, the focus will be on inclusive growth through investments aimed at responding to industrial transitions, strengthening labor market competitiveness, enhancing job support for youth and local communities, and addressing low birth rates and aging populations.
Minister Kim Young-hoon stated, "The discussions on job policy direction, innovation in employment services, and responses to regional employment crises are all core tasks aimed at creating a country where everyone can work happily. We will faithfully reflect the opinions presented in the council to ensure that policies lead to tangible results on the ground."
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.