Seoul, July 21 (IANS) Nearly 60 per cent of South Korea’s mid-sized companies have no plans to hire new employees in the second half of the year due to an economic slowdown, a local business lobby group said on Monday.

In a recent survey of 800 mid-sized companies, the Federation of Middle Market Enterprises of Korea (FOMEK) found that 56 percent do not plan to hire in the second half, reports Yonhap news agency.

Respondents cited worsening business performance, rising labor costs and the economic downturn as the main reasons for not hiring.

In South Korea, companies with total assets between 500 billion and 10 trillion won are classified as mid-sized businesses.

The remaining 44 percent said they plan to hire in the second half, though some expect to reduce the scale of hiring compared with the first half due to sluggish demand.

Companies urged the government to increase financial support for hiring, create a more flexible job market and offer additional tax benefits.

“The government needs to come up with solutions to key labor issues such as extending the retirement age, reorganizing ordinary wages and adjusting working hours,” a FOMEK official said.

Meanwhile, Seoul shares traded higher on Monday, driven by the strong performance of big-cap tech shares and foreign purchases.

The benchmark Korea Composite Stock Price Index (KOSPI) had added 14.29 points, or 0.45 percent, to 3,202.36 as of 11:20 a.m.

Foreign investors purchased 427.7 billion won (US$307 million) worth of local shares, while institutions bought 161.4 billion won. Retail investors had dumped 627.3 billion won worth of shares for profit taking.

On Friday, Wall Street closed mixed as concerns over the Trump administration’s tariff policies offset the risky appetite brewed by strong U.S. retail sales data.

The Dow Jones Industrial Average shed 0.32 percent, and the S&P 500 edged down 0.01 percent, while the tech-heavy Nasdaq composite inched up 0.05 percent.

—IANS

na/