Increased Spending on Alcohol and Tobacco Due to COVID-19... Record High of 4.3 Trillion Won in Q3 Last Year

[Image source=Yonhap News]

[Asia Economy Reporter Eunbyeol Kim] Last year, as the novel coronavirus disease (COVID-19) spread, domestic consumers' spending on alcohol and tobacco surged to the highest level ever recorded.

According to the Bank of Korea on the 5th, in the third quarter of last year, household final consumption expenditure by purpose (seasonally adjusted, nominal) on alcoholic beverages and tobacco amounted to 4.2975 trillion won. This is the largest amount since the Bank of Korea began compiling related statistics in 1970.

Earlier, in the first quarter of last year, spending in this sector recorded 4.1585 trillion won, ranking third highest historically after the fourth quarter of 2017 (4.2009 trillion won) and the first quarter of 2016 (4.1752 trillion won). In the second quarter of last year, spending reached 4.1761 trillion won, closely approaching the record set in the fourth quarter of 2017, and in the third quarter, it set a new record.

Spending on alcohol and tobacco in the third quarter of last year increased by 6.2% compared to the same period the previous year, the highest growth rate in about four years since the second quarter of 2016 (6.5%). The growth rates were 0.7% in the first quarter and 1.3% in the second quarter of last year. It appears that the increase in alcohol and tobacco consumption was due to growing collective fatigue from the spread of COVID-19 and the strengthening of social distancing measures.

During the shadow of the foreign exchange crisis in the first quarter of 1997, 1.6895 trillion won was spent on alcohol and tobacco, a 20.0% increase compared to the previous year. In the second quarter of that year (1.6930 trillion won), the year-on-year growth rate reached 18.6%.

According to the Statistics Korea Household Trend Survey, in the third quarter of last year, the average monthly household expenditure on alcoholic beverages and tobacco nationwide (for households with two or more members) was 42,980 won, the highest since statistics began in 2003. Both alcohol (19,651 won) and tobacco (23,329 won) consumption expenditures were the highest ever recorded.

The impact of COVID-19 also affected leisure culture. As of the third quarter of last year, consumption expenditure in the entertainment, sports, and culture sectors was 12.3963 trillion won, the lowest since the third quarter of 2012 (12.3298 trillion won).

Compared to the third quarter of 2019, this represents a 24.1% decrease, the largest decline ever recorded. This is attributed to many performance venues and sports facilities closing due to strengthened social distancing measures.

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