Moon Says Economic Policies on Right Path

President Moon Jae-in said on Saturday South Korea’s economic policies are on the right path to boost jobs and address inequality.

“Our economic policies are on the right path. The government will be making an all-out effort to address employment issues and income inequality,” Moon said at the national democratic convention in Seoul, Reuters reported.

Moon said he was aware of public concerns over the lack of jobs growth but economic recovery was intact because of robust exports growth and moderate increases in household income.

In a major setback for the self-styled “Jobs President”, South Korea’s July jobs report showed Asia’s fourth-largest economy added a mere 5,000 jobs from a year earlier, the smallest annual gain since January 2010 when the economy was still reeling from the global financial crisis.

Just two months ago, Moon’s popularity was sky-high as the public lauded the left-leaning former human rights lawyer’s diplomatic progress with North Korea.

But his approval ratings since then have plunged by nearly 30 percentage points to the lowest since his election in May 2017. Many blame his controversial plans to sharply raise minimum wages and cut working hours for contributing to the worst job market since the 2008-2010 financial crisis.

With job losses hitting his main support base particularly hard, Moon may have little choice to roll back, or at least soft-pedal, some of his ambitious “income-led growth” policies that centered on higher minimum wages, officials, economists and political analysts say.

Failure to address the public uproar over jobs could also cost Moon political capital to pursue his other signature initiative—closer ties with North Korea—because a poorer public will be less supportive of using taxpayer money to fund cooperation with Pyongyang.