South Korea must complete labor market reform by the end of the year to help young people find jobs and raise the country's overall competitiveness, the top economic policymaker said Thursday.
  

In a meeting with lawmakers from the ruling Saenuri Party in Seoul, Finance Minister Choi Kyung-hwan claimed that reforming the country's rigid labor rules and allowing for more flexibility can give hope to the younger generation who are facing tough challenges.
  

The slowdown in growth and the move to raise the country's retirement age to 60 from 58 is expected to force companies to hold off hiring new workers for the next couple of years. Such a development, the finance minister said, can spell trouble not only for the individuals directly affected, but society as a whole.
  

"Labor reform is something that must be resolved this year," he said. "The country is entering a period of rapid population aging coupled with low growth that is affecting the job market as a whole."
  

Choi, who doubles as deputy prime minister in charge of economic affairs, said once headway has been made on labor issues, the government plans to concentrate on revamping the country's financial and education sectors as well as accelerating the current administration's Three Year Plan for Economic Innovation.

Choi also said the government plans to use 11.53 trillion won in extra budget this year to revive economic growth momentum and cope with the drop in exports.
  

The government predicted Asia's fourth-largest economy will grow 3.1 percent in 2015, down from 3.8 percent predicted earlier in the year. Exports contracted 4.9 percent on-year in the January-July period due to sluggish global growth.
  

"The government will do more to set up new growth industries, innovate the manufacturing sector, and encourage exports and the expansion of high value-added service businesses," he told lawmakers.
  

Touching on the matter of the government running up debt, Choi pledged to implement fiscal reforms that can reduce unnecessary spending. (Yonhap)