COVID-19 Shock, Unemployment Hits Highest in 21 Years

May Employment Trends

Employment down by 392,000... Decline continues for three consecutive months

Decrease persists in food and lodging, wholesale and retail sectors

[Sejong=Asia Economy Reporter Joo Sang-don] Due to the impact of the novel coronavirus disease (COVID-19), the number of employed people decreased by more than 390,000 last month, marking a decline for three consecutive months. This is the first time since the global financial crisis that employment has decreased for more than three months. In particular, the number of unemployed and the unemployment rate in May reached historically worst levels. Concerns are growing that the employment shock caused by COVID-19 is intensifying.

According to the 'May Employment Trends' released by Statistics Korea on the 10th, the number of employed persons aged 15 and over was 26.93 million, down 392,000 (-1.4%) compared to the same month last year. The continuous decline in new employment for more than three months is the first since the global financial crisis, when employment decreased for four consecutive months from October 2009 to January 2010. At that time, the decreases in employment were 6,000 in October 2009, 34,000 in November, 34,000 in December, and 10,000 in January 2010. In terms of the scale of employment decline, the current level surpasses that period.

All age groups except those aged 60 and over experienced a decrease in employment. While those aged 60 and above increased by 302,000, the decreases were recorded as follows: 187,000 in their 40s, 183,000 in their 30s, 140,000 in their 50s, and 134,000 in their 20s.

By industry, employment increased in health and social welfare services (131,000; 6.0%), agriculture, forestry and fisheries (54,000; 3.6%), and transportation and warehousing (50,000; 3.5%). In contrast, decreases were seen in wholesale and retail trade (-189,000; -5.1%), accommodation and food services (-183,000; -7.9%), and associations, repair, and other personal services (-86,000; -6.8%). Notably, manufacturing employment decreased by 57,000, continuing a three-month consecutive decline since March (-22,000).

The number of unemployed also rose sharply as people who had given up job searching resumed their job-seeking activities. The unemployed numbered 1.278 million, an increase of 133,000 (11.6%) compared to the same month last year. This is the highest level for May since the related statistics criteria changed in June 1999. The unemployment rate rose to 4.5%, up 0.5 percentage points from the same month last year.

The temporarily absent workers?those currently working zero hours due to illness, leave, education, etc., but expected to return within six months?numbered 1.02 million, an increase of 685,000 (204%) compared to the same month last year. However, the increase was smaller than the previous month (1.13 million).

Jung Dong-wook, head of the Employment Statistics Division at Statistics Korea, said, "As social distancing shifted to everyday distancing on May 6, the decline in face-to-face sectors such as wholesale and retail and accommodation and food services narrowed, reducing the overall employment decline compared to April (-476,000). Going forward, the trend of COVID-19 confirmed cases and the manufacturing sector situation will influence the overall employment decline."

This content was produced with the assistance of AI translation services.