No Escape from the 'Employment Shock'... "Real Economy Uncertainty Continues"

Ministry of Economy and Finance Publishes 'Recent Economic Trends October Issue'

(Photo by Yonhap News)

[Asia Economy Reporter Kwangho Lee] The Ministry of Economy and Finance diagnosed on the 16th in the 'Recent Economic Trends (Green Book) October issue' that "Recently, our economy has been experiencing a gradual recovery in exports, but since mid-August, uncertainties in the real economy continue due to the resurgence of COVID-19 domestically, which has constrained the recovery of domestic demand and employment indicators."

The Green Book, published monthly by the Ministry of Economy and Finance, is the government's official diagnosis of the Korean economy.

Last month, the deterioration of employment indicators was particularly notable. The number of employed persons in September was 27.012 million, a decrease of 392,000 compared to the same month last year.

The employment rate for ages 15 to 64, based on the OECD standard, recorded 65.7%, down 1.4 percentage points from the same month last year.

The unemployment rate rose by 0.5 percentage points to 3.6%. The increase in regular workers slowed, and temporary and daily workers, considered the 'weak link' in the labor market, continued to decline along with self-employed workers.

Neither households nor businesses are opening their wallets easily. In September, consumer prices rose 1.0% year-on-year due to significant increases in agricultural, livestock, and fishery product prices caused by typhoons and heavy rains.

Retail sales in August decreased in semi-durable goods such as clothing (-4.4%), but increased in durable goods like home appliances (12.7%) and non-durable goods such as food and beverages (0.9%), resulting in a 0.3% increase compared to the same month last year. However, industrial production (-3.0%) and service production (-3.7%) declined, pulling down total industrial production by 3.4%.

Exports, which had been declining since COVID-19, turned to growth after seven months. September exports amounted to $48.05 billion, up 7.7% year-on-year.

In September, the domestic financial market saw a slight rise in stock prices, a decline in exchange rates due to expectations of a U.S. stimulus agreement, and a drop in government bond yields due to increased foreign investment in government bonds.

During the same period, the housing market saw a narrowing in the rise of sale prices, but the rise in jeonse (long-term lease) prices increased by 0.54%.

The Ministry of Economy and Finance emphasized, "Externally, concerns about delays in global economic recovery persist due to the slowdown in major countries' real indicators and the spread of COVID-19 in Europe and emerging countries. We will strengthen comprehensive policy responses, including thorough quarantine measures, active fiscal spending, revitalization of domestic demand, and maintaining export capabilities to recover livelihoods and the economy."

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