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IT and Employment: Policy Issues and Suggestion

  • Informatization Policy
  • Abbr : 정보화정책
  • 2009, 16(2), pp.27-46
  • Publisher : NIA
  • Research Area : Social Science > Public Policy

Taeyoon Sung 1 Chanhi Park 2 박기영 1

1연세대학교
2중앙대학교

Accredited

ABSTRACT

This paper reviews previous studies on how the development of the IT industry directly and indirectly affects employment in the economy and discusses the appropriate role of the government in maintaining and creating jobs. The results of previous studies on effects of IT development and investment on employment could be classified into three major categories. First, IT development directly reduces employment. Second, overall employment could increase. Third, composition of workforce rather than employment itself could change. When discussing the employment effect of IT, policymakers should take into account not only direct employment in the industry but also indirect effects including job creation in other industries, new business creation and productivity growth, since the IT industry exerts positive externality and feedback effects to other industries. Government investment should be focused on infrastructures, which have positive externality effects by creating demands in the private sector, not on direct support for specific firms or industries. In addition, the government should make efforts to lay a foundation for absorbing labor released from the current employment. Accordingly, constructing infrastructures should accompany a system that reflects the private sector's demand.

Citation status

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