This is the sharpest loss since 1999. For South Korean leaders, the situation is serious, and could worsen in the coming months. The government is working on a third supplementary budget to create 550,000 new jobs. A new outbreak and a drop in exports threaten the recovery.
Seoul (AsiaNews/Agencies) – The number of employed people in South Korea stood at 26.56 million in April, 476,000 people fewer than a year ago, Statistics Korea reported. This marks the biggest on-year decline since February 1999 when the country was facing the fallout of the Asian financial crisis.
The country’s jobless rate fell by 0.2 percentage point on-year to 4.2 percent in April but the labour force participation rate[*] also fell. This is a cause for concern that many might not find a job at this time of crisis.
For South Korean leaders, the situation is serious, and could get worse in the coming months. Large-scale retail and hospitality industry have been the hardest hit in the recession, especially seasonal workers.
To deal with the situation, the authorities plans a third supplementary budget to create more than 550,000 new jobs, and President Moon Jae-in is proposing a “digital New Deal” for companies, as well as enhanced smart working, to reverse the negative trend.
To finance this, the government is considering slashing military spending by 700 billion won (US0 million).
South Korea’s overall stimulus package totals 135 trillion won (US0 billion) aimed at jumpstarting the country’s economy. However, a new COVID-19 outbreak in Itaewon, Seoul, is not helping efforts to revive production and consumption.
So far, South Korea has reported 10,962 cases, including 26 today with 259 deaths, making it one of the countries to have best contained the spread of the disease. Starting two weeks, the authorities began to progressively ease social confinement measures.
But trends in the world economy are not helping. South Korea’s export-oriented economy has been negatively impacted by the disruption in international supply chains after importing countries were locked down.
In the first ten days of May, South Korean exports fell by 46.3 per cent over the same period last year. Car exports plunged by 80.4 per cent, smartphones by 35.9 per cent, and microchips by 17.8 per cent.
[*] The labour force participation rate refers to the percentage of those aged 15 or older who are employed or actively seeking employment.