ed Young people getting poorer

The household income of the nation’s younger generation decreased for the first time last year.

According to a report on income trends released by Statistics Korea, the average monthly income of households with more than two members whose breadwinner is 39 years or younger amounted to 4.32 million won last year, down 0.6 percent from a year earlier.

This is the first time that the income of younger people has dropped since 2003 when the statistics office began compiling such data. The income for the younger generation posted a 7.4 percent gain in 2013 from 2012, but the figure dipped to 0.7 percent in 2014 as people in their 20s and 30s struggled to find jobs.

This was in a sharp contrast to income growth among older people. A family supported by a person in his or her 40s saw monthly income grow 2.8 percent last year, while households with breadwinners in their 50s saw their monthly income rise 2 percent. Those in their 60s posted a whopping 6.8 percent income gain.

Given these generational income growth disparities, people now in their 20s and 30s might become poorer than previous generations in what appears to be a rare phenomenon.

Without doubt, unemployment woes stood behind the first income drop for the younger generation. The jobless rate for people aged between 15 and 29 hit an all-time high of 9.2 percent last year. In January, the youth unemployment rate rose to 9.5 percent, and there are fears that the February figure could be double digit.

As bad as it is, though, the actual youth jobless rate might be much higher, considering young job applicants and some university students putting off graduation, who are excluded from the jobless statistics.

The quality of jobs is also quite problematic. A separate report by Statistics Korea showed that among 4 million young people who got their first jobs last year, 20.3 percent were hired on a contractual basis lasting less than one year.

Spending by younger households contracted too. They spent 3.36 million won per month last year, down 0.9 percent from 2014. Expenses for garments and shoes fell by 9.3 percent amid soaring housing costs.

The income shrinkage of younger households must be taken seriously because it could trigger a vicious circle of depressed consumption, low growth, sluggish corporate investment and overall declines in employment.

The point is whether our society can provide decent jobs for young people. At this juncture, we feel a sense of urgency ― once again ― to speed up structural reform of our labor market.