Hollowing-out fear may be unfounded; Manufacturers' GDP share,.

(From The Korea Herald)

By Kim Tae-gyun As many manufacturers move overseas to seek cheap labor, experts have expressed concerns that the migration may trigger large job loss and harm the manufacturing sector. But that may be a groundless fear, a corporate think tank said in its report.

According to a report by LG Economic Research Institute, the economic data does not show any significant sign that Korean manufacturers moving overseas have caused an industrial hollowing-out. The report noted that movements overseas did not lower the manufacturing sector's share of gross domestic product, nor significantly reduce employment prospects in the nation's labor market. The manufacturers' contribution to GDP has stayed at around 33 percent over the past five years, the paper stressed. The think tank also said the production sector had not seen its total jobs drop since 1999. It said the manufacturing sector's share in the economy's job market had showed a steady figure around 19 percent during the time span.

"Since two years ago, Korea has suffered an economic slump. Basically, the production sector is more vulnerable to a recession than service industries," said Park Rae-jung, an LG researcher who led the study. "Subsequently, the sagging economy has reduced the employment prospects in the sector.

"But it is not accurate to say that the migration movement has caused the job loss," he said. The think tank said the job loss problem that the hollowing-out would create had been "somewhat exaggerated." According to the government's survey, only 12.3 ...