Korean Employment Faces 'Total Crisis'... Employed Decrease, Unemployed Increase, Support Funds Depleted

Government's Youth and Women Policy Measures, Despite 'January Employment Bottom Theory' Announcement
Indicators Worsen and Support Funds Deplete... Employment Vitality Declines↓

On the 9th, citizens are receiving consultations for unemployment benefit applications and employment support at the Seoul Employment Welfare Plus Center in Jung-gu, Seoul. Photo by Mun Ho-nam munonam@

[Sejong=Asia Economy Reporter Moon Chaeseok] Korean employment has fallen into a total crisis. The number of employed people is decreasing while the number of unemployed is increasing, walking the worst path. The job-seeking promotion subsidies funded by taxes are also continuously declining.

According to the employment trend report for January released by Statistics Korea, the number of employed people last month was 25,818,000, down 982,000 (3.7%) compared to the previous year. This is the largest decrease in 22 years since December 1998, when 1,283,000 people decreased during the International Monetary Fund (IMF) financial crisis.

Last month, the number of unemployed was 1,570,000, an increase of 417,000 (36.2%) compared to the same month last year. The increase was the largest in 20 years since June 2000. The unemployment rate rose by 1.6 percentage points to 5.7% during the same period.

The job-seeking vitality is also weakening. Last month, the economically inactive population was 17,580,000, an increase of 867,000 (5.2%) compared to the same month last year, and among them, the population who did not seek jobs for reasons other than study or household duties, called 'resting' (379,000 people, 16.2%), increased across all age groups.

In particular, the 'resting' population among the youth in their 20s and 30s increased by 105,000 (29.4%) and 71,000 (33.9%), respectively. The increase in the 'resting' population in their 20s and 30s is considered a very serious factor that extinguishes the country's economic growth momentum.

Minister Lee Jae-gap of the Ministry of Employment and Labor is speaking at the "National Employment Support System Participants Meeting" held on the 3rd at the Southern Employment Center in Yeongdeungpo-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

The government is implementing job-seeking promotion policies such as unemployment benefits and the National Employment Support System on all fronts. The problem is that the subsidies for these policies are decreasing, while there is little sign of an increase in quality jobs.

First, the number of unemployed people who newly applied for unemployment benefits last month after losing their jobs was 212,000, the highest ever on a monthly basis.

The number of applicants for the National Employment Support System reached 199,000 in one month. This system provides 3 million won per person to low-income job seekers, youth, and women with career interruptions, and has been in operation since January.

Initially, the Ministry of Employment and Labor targeted about 400,000 people for support, but 200,000 applied within a month.

Meanwhile, the Ministry of Employment and Labor announced in this year's work plan that it will raise the employment insurance premium rate, citing the need to no longer delay fiscal soundness.

With many expenditures and no incoming funds, the resources will likely end up coming from taxes.

Given this situation, expectations for youth employment measures announced by the government for the first quarter are diminishing.

There are growing voices that Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki's remark, "We cautiously expect a slight improvement starting from the bottom in January employment," and Minister of Employment and Labor Lee Jae-gap's message, "We will create jobs for youth and women," lack weight.

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