Value context and insight. lkm@koreatimes.co.kr
No. of jobless people hits record high amid pandemic
By Lee Kyung-min
By Lee Kyung-min
The COVID-19 pandemic has pushed the unemployment rate to a record high, with massive job losses continuing for the third consecutive month, data showed Wednesday.
According to Statistics Korea, the number of unemployed people jumped to 1.27 million in May, up 133,000, or 11.6 percent from a year earlier. The unemployment rate reached 4.5 percent, up 0.5 percentage points from the year before.
Both figures are the highest the statistics agency has seen in its history of compiling related data starting 1999.
In May, 392,000 lost their jobs, a continued loss since March when the figure was 195,000 followed by 476,000 in April.
Some 302,000 people aged over 60 lost jobs, with those in other age groups reporting job losses of between 5,000 and 187,000.
By sector, retail and wholesale saw 189,000 jobs vanish, whereas 183,000 jobs were slashed in the lodgings and eateries businesses. The two are the hardest-hit areas following the pandemic.
Low-paid sales workers and service industry workers lost 118,000 and 82,000 jobs, respectively.
Some 393,000 jobs were added for regular workers but the new jobs failed to offset the 653,000 jobs that were cut for temporary workers and day laborers combined.
“People in low-income brackets were hit hardest in the current economic crash,” Yonsei University economist Sung Tae-yoon said.
“Positions held by senior citizens are barely considered quality jobs. They are time-killing activities at best. The job data in the coming months will paint a much grimmer picture.”
This pessimistic view was echoed by Seoul National University economics professor Kim So-young.
“The new coronavirus is taking a heavy toll on the people with a relatively low economic standing, illustrated by temporary and irregular workers losing jobs compared to jobs added for regular workers. The job market polarization will become more pronounced in the economic uncertainty.”
The export-reliant economy will have to brace for further “shock” in the coming months as more people in the manufacturing sector ― the key growth driver and creator of quality jobs ― will lose more jobs, Kim added.
“Other countries are still struggling to contain the virus and a slowdown there will mean reduced trade, translating to the deterioration of local firms' corporate profits which will be followed by layoffs,” he said.
Deputy Finance Minister and Finance Minister Hong Nam-ki said May figures are an improvement from April, but the manufacturing job losses are worrisome.
“Jobs lost in manufacturing increased to 57,000 in May, up from 44,000 in April. The service sector could lose more jobs depending on the effectiveness of quarantine measures to come,” he said in a Facebook post.
“The government submitted a third extra budget bill June 4, awaiting much-needed approval. The bill must pass before the end of June to promptly help those most in need.”