Semiconductor Supply Eases, Industrial Production Index Hits Highest in 1 Year and 5 Months (Comprehensive)

Statistics Korea Announces 'November Industrial Activity Trends'

Total Industry Production Index Up 3.2%
Consumption Down 1.9%... "Base Effect Impact"

Thanks to the strong performance of key industries such as semiconductors, shipbuilding, and automobiles, South Korea's annual export value reached a record high this year. Early on the 19th, export cargo was loaded onto an Asiana Airlines cargo plane at the Incheon International Airport cargo terminal. Photo by Moon Honam munonam@

[Sejong=Asia Economy Reporter Moon Chaeseok] With the expansion of manufacturing and service production, total industrial production last month increased by more than 3% compared to the previous month. This marked the highest growth rate in 1 year and 5 months since June last year. On the other hand, consumption decreased by nearly 2% due to the base effect following the consumption boom in the previous month.

According to the 'November Industrial Activity Trends' released by Statistics Korea on the 30th, the total industrial production index last month was 114.4 (2015=100), an increase of 3.2% from the previous month. This was the largest increase since June last year (3.9%).

The production increase was largely influenced by the base effect. Total industrial production in October fell by the largest margin in one and a half years due to substitute holidays and other factors, but in November, as these effects disappeared, production rebounded sharply. Eo Unseon, Director of Economic Trend Statistics at Statistics Korea, said, "If we compare November with September instead of October, which was affected by irregular factors such as substitute holidays, industrial production is estimated to have increased by about 1.3%."

Manufacturing and service production increased by 5.3% and 2.0%, respectively. In particular, the growth in automobiles (11.3%) and semiconductors (4.5%) was notable. Semiconductor inventory decreased by 7.3% last month, marking a decline for the first time in five months. Service production increased in sectors such as accommodation and food services (5.6%). Facility investment rose by 10.9%, the largest increase in seven years since November 2014.

The retail sales index (seasonally adjusted), which indicates consumption trends, was 119.1 (2015=100), down 1.9% from the previous month. Despite the phased return to daily life (With Corona) implemented last month, this was the largest decline since July last year (-6.1%). Director Eo explained, "Since consumption in October recorded the highest level since statistics began, the base effect was significant."

The coincident index of economic indicators, which reflects the current economy, rose by 0.4 points to 101.4, turning to an upward trend. However, the leading index of economic indicators, which predicts future economic conditions, fell by 0.4 points, continuing a decline for five consecutive months since July. Director Eo assessed the outlook for December indicators, saying, "Since the November figures were very good, there is pressure for adjustment, so December may see a correction," adding, "Overall, the situation remains highly uncertain."

The government has not lowered its guard either. Hong Namki, Deputy Prime Minister and Minister of Economy and Finance, wrote on his social media on the same day, "With the implementation of strengthened quarantine measures due to the spread of COVID-19, there are concerns about the impact on domestic demand," and added, "From the beginning of the year, we will promote early fiscal spending, support for livelihood stabilization, and job creation."

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