'Employment Declines for 9 Consecutive Months'... Employment Indicators Return to Foreign Exchange Crisis Levels (Comprehensive)

Employment Decreased by 270,000 Last Month...Longest Decline Since 1999
Government Finds Comfort in "Slowing Decline"
Concerns Raised That "If Escalated to Level 3, Decline Could Increase to 700,000"

[Asia Economy Reporters Joo Sang-don and Jang Se-hee] The decline in new employment has continued for nine consecutive months, marking the longest period in 21 years since 1999. As various economic indicators regress to levels seen during the International Monetary Fund (IMF) foreign exchange crisis, employment is also heading toward its worst situation. The government emphasizes that the decrease in the number of employed people in November narrowed compared to the previous month, but if social distancing measures are raised, the decline is expected to widen again. Some voices express concern that if social distancing is elevated to level 3, the decrease in employment could expand to as much as 700,000 people.

According to the 'November Employment Trends' released by Statistics Korea on the 16th, the number of employed persons aged 15 and over was 27,241,000, down 273,000 (-1.0%) compared to the same month last year. Although the decrease narrowed compared to October (-421,000), the trend has continued for nine months. This is the first time in about 21 years since the 16 consecutive months of decline from January 1998 to April 1999 during the IMF foreign exchange crisis.

On the other hand, the number of unemployed persons increased for seven consecutive months. The number of unemployed in November was 967,000, up 101,000 (11.7%) compared to the same month last year. The unemployment rate was 3.4%, rising 0.3 percentage points from a year earlier. The expanded unemployment rate, measured by Employment Supplementary Indicator 3 (broad unemployment rate), was 13.0%, up 2.5 percentage points. In particular, the expanded unemployment rate for the youth group (ages 15?29) rose 4.0 percentage points to 24.4%.

Jung Dong-myung, Director of the Social Statistics Bureau at Statistics Korea, explained, "In November, due to the easing of social distancing, some industries showed (positive) effects, reducing the decline in employment and the increase in unemployment. Specifically, the decrease in employment in retail, wholesale, accommodation, and food face-to-face service industries narrowed, while the increase in public administration, health and welfare, and construction industries slightly expanded."

Regarding the November employment indicators, the government has evaluated that the worst phase has been avoided. On the same day, Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, presided over a green room meeting and stated, "Although employment decline has continued for nine months, the improvement in employment conditions compared to October is positive." He also assessed that compared to other countries, Korea's employment situation is relatively favorable.

The problem is that the employment situation in December is highly likely to worsen further. The daily number of COVID-19 confirmed cases has again exceeded 1,000, increasing the possibility of raising social distancing levels. The November employment trend survey period was from the 15th to the 21st of last month, during which daily confirmed cases were in the 200s. Since December, COVID-19 has started to surge again, and calls for raising social distancing to level 3 are gaining strength. If realized, additional shocks to the employment market are inevitable.

Professor Park Young-beom of Hansung University’s Department of Economics warned, "Since the survey period itself reflects the effects of eased social distancing, the domestic demand situation has not fundamentally changed. If social distancing is raised to level 3, the decrease in the number of employed could expand to 600,000 to 700,000." Professor Sung Tae-yoon of Yonsei University’s Department of Economics also expressed concern, saying, "Considering the current spread of COVID-19, the employment situation in December could worsen further. If the level is raised, the economy itself will slow down, and jobs in both face-to-face and non-face-to-face (untact) sectors could be hit."

The government plans to make every effort to prevent the spread of COVID-19. Deputy Prime Minister Hong said, "The government will concentrate all government-wide capabilities on preventing the spread of COVID-19, which is a prerequisite for stabilizing the employment market, and will devote all efforts to job creation and maintenance, as well as supporting the livelihoods of those affected by employment deterioration. We will also carry out the employment-related tasks contained in the '2021 Economic Policy Direction' to be announced on the 17th without fail."

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