「Pan-Impact Korea」 Launched a New SIB Project to Deal with Young Adult Unemployment Problem
Background
The number of the unemployed young adults in South Korea has been continuously increasing. However, it is more than a million, considering potential young workers including the discouraged workers who are not counted in unemployment statistics. Moreover, young people preparing recruitment or civil service exams are over a million. Given this population, 20~30% of the young have the difficulty in finding jobs in Korea.
The social problem of the young adult unemployment has got worse. The gap between the total unemployment rate and the youth unemployment rate was about 3%p in 1990s, but it was doubled in 2017.
On government figures, the unemployment among young people are caused by a loss of jobs that the young want to get, a decline of recruitment in the private sector, the young adults’ strong job inclination to large companies or public sector, etc.
If this problem is neglected, there will arise more serious long-term social problems such as a decline in income and productivity, economic depression, and social division.
The Second Seoul SIB Project
After the success of the first Seoul SIB project, the Seoul Metropolitan Government decided to launch the second Seoul SIB to deal with the young adult unemployment problem. The Seoul Metropolitan Government selected Pan-Impact Korea as the official intermediary for the second Seoul SIB project, and finalized the contract with Pan-Impact Korea in August, 2019.
Pan-Impact Korea, as the intermediary, manages this SIB project in the overall by taking charge of raising capitals, choosing a service provider and so on.
The second Seoul SIB project targets more than 500 unemployed young people who
meet conditions of the hard-to-employ population defined by the Seoul Metropolitan Government. The conditions include young people under median income, the long-term unemployed, NEET(Not in Education, Employment or Training), discouraged workers, North Korean refugees, single parents, etc. After the service provider chooses the young who meet these conditions, Pan-Impact Korea and the Seoul Metropolitan Government filter them out by checking their qualification one more time.
The budget to carry forward the project is 3 billion KRW in total. 0.1 billion of this budget will be provided with the evaluator by the Seoul Metropolitan Government. The rest of the budget, 2.9 billion KRW is planned to be raised by private investors.
Below are the structure and a short summary of the second Seoul SIB project.
<The Structure of the 2nd Seoul SIB Project>
Summary of the Project
▶ Commissioner : Seoul Metropolitan Government
▶ Intermediary : Pan-Impact Korea
▶ Investors : Korea Social Value and Solidarity Foundation, Community Chest of Korea, BPlus, KB Insurance, ReturnValues, Daekyo Culture Foundation
▶ Service Providers : Korea Productivity Center, Percent(Corp.)
▶ Evaluator : Korea Institute for Industrial Research
▶ Project Duration : 3 Years (2020~2023)
▶ Target Population : More than 500 unemployed young adults aged from 19 to 34
▶ Performance Goal : More than 200 beneficiaries meet the predefined target
▶ Predefined Target : The number of the young adults who are employed or set up their own businesses (Regarding employees, only regular workers and workers with at least one-year-contract are counted.)
▶ Investment Size : 2.9 billion KRW
▶ Maximum Success Payments : Investment Principal + Approx. 25% Interest