Economic Shock from COVID-19... 15 Cities and Provinces Outside Seoul See Decline in Service Industry Production Last Year

Q4 2020 and Annual City/Province Service Industry Production and Retail Sales Trends... 'Tourist Destination' Jeju, Duty-Free Shop Consumption Down 70.6%

On the 8th, as strong social distancing measures to prevent the spread of COVID-19 continue, COEX in Gangnam-gu, Seoul, is seen quiet./Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Son Sun-hee] Last year, due to the COVID-19 pandemic, service industry production decreased in 15 cities and provinces nationwide except for Seoul. In particular, Jeju, known as a major tourist destination, was the only city/province to show a double-digit decline (-10.4%). Sales at duty-free shops and other outlets were hit, causing annual retail sales to drop by 26.9% compared to the previous year.

According to the '2020 Q4 and Annual City/Province Service Industry Production and Retail Sales Trends' released by Statistics Korea on the 9th, Jeju had the largest decline in service industry production at -10.4%, followed by Incheon (-9.8%), Gangwon (-4.9%), Gyeongbuk (-4.2%), and Busan (-4.1%).

Seoul was the only region nationwide where service industry production increased by 1.1% compared to the previous year. Although sectors such as transportation and warehousing (-29.8%) declined, there were significant increases in finance and insurance (21.9%) and real estate (15.8%). This is believed to be due to active stock and real estate transactions last year.

Regions where real estate sector service industry production increased nationwide include Seoul, Incheon (18.7%), and Gwangju (21.1%).

Retail sales declined in eight cities and provinces including Seoul (-9.0%), with Jeju showing a particularly notable drop of -26.9%. Consumption slightly increased in passenger car and fuel retail stores (4.0%) and supermarkets, miscellaneous goods, and convenience stores (1.6%), but overall consumption contracted significantly due to sharp decreases in duty-free shops (-70.6%) and specialty retail stores (-17.9%).

Yang Dong-hee, head of the Service Industry Trends Division at Statistics Korea, said, "Overall last year, finance, insurance, and real estate sectors were booming, while face-to-face service industries performed poorly. The results varied depending on the proportion these industries occupy within each region."

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