South Korea’s government has responded to rising oil prices and inflation, which have disproportionately affected small business owners, youth, and other vulnerable groups. The Ministry of Planning and Budget announced a supplementary budget proposal on March 31, 2024, aiming to stabilize livelihoods and mitigate economic shocks. The government identified a significant decline in small business sentiment and youth employment rates, with the Business Sentiment Index dropping from 79.1 in October 2023 to 68.1 in February 2024, and youth employment falling for 22 consecutive months. The supplementary budget is designed to provide targeted support and foster economic resilience amid ongoing global uncertainties.
The 2.8 trillion won budget is divided into three main areas: 800 billion won for daily recovery of vulnerable groups, 1.9 trillion won for youth entrepreneurship and job support, and 100 billion won for inflation relief. Measures include doubling the number of ‘Just Dream Centers’ nationwide to 300, expanding emergency welfare cases, and increasing support for care services and welfare facility heating and cooling. For small business owners, the ‘Hope Return Package’ will be expanded, and additional emergency management funds will be supplied. Youth support features entrepreneurship competitions, funding for promising startups, and expanded job training and employment incentives.
Implementation began with the submission of the supplementary budget to the National Assembly on March 31, 2024. The government plans to rapidly scale up welfare and employment programs, including expanding emergency welfare to 391,000 cases and increasing care services for 28,000 households. Youth entrepreneurship initiatives will select 300 promising startups and provide up to 1 billion won in commercialization funds, alongside new regional startup ecosystems and job training programs. Inflation relief measures will include food discounts and expanded cultural and tourism subsidies, benefiting an estimated 6.87 million people.
Frequently asked questions include: What support is available for victims of rental fraud? The government is launching a new program guaranteeing at least one-third of deposits for affected tenants, with a budget of 27.9 billion won. How will youth employment be addressed? The budget expands job training, increases employment incentives, and creates over 23,000 new public sector jobs. What is the timeline for these measures? Most programs will be implemented throughout 2024 following budget approval, with immediate expansion of welfare and employment support.
South Korea’s 2024 supplementary budget is a comprehensive response to the economic challenges posed by rising oil prices and inflation. The government’s focus on vulnerable groups and youth, through expanded welfare and employment programs, is grounded in clear data showing declining business sentiment and youth employment. The rapid scaling of support measures, including new programs for rental fraud victims and expanded entrepreneurship funding, is likely to provide immediate relief and long-term benefits. The policy’s emphasis on both economic stabilization and future growth demonstrates a balanced approach to crisis management.