More construction workers seek unemployment benefits amid industry slump

Workers wearing safety gear walk toward a construction site of an apartment complex in Seoul in this October 2022 file photo. Yonhap

A protracted slump in the construction industry is forcing more workers to apply for unemployment benefits after failing to land jobs.

According to the Ministry of Employment and Labor on Tuesday, 18,000 construction workers applied for unemployment benefits in July. These benefits are provided by the government to individuals who have lost their jobs through no fault of their own.

The July figure jumped by 47,000 from the previous year. It also accounted for nearly 70 percent of those who applied for unemployment benefits in the same month.

The figure came as Statistics Korea announced that the number of newly added jobs in the construction sector totaled 2.05 million in June, which was the lowest since March.

"The decrease in job addition shows the gloomy status of the construction business," an industry source said, noting June is supposedly the busiest season as builders push to make progress on projects before heavy rainfall followed by heat waves in summer.

Separately, the Construction & Economy Research Institute of Korea said Korea's construction business survey index stood at at 72.2 in July.

A reading below 100 means there are more construction companies that are pessimistic about business outlook than those that are optimistic.

The reading was worse in rural areas, which averaged 60.3 compared to Seoul's 91.2

Industry sources forecast the number of unemployment claims to rise in the latter half of 2024, as government-related construction projects were concentrated in the first half of the year.

They also said "it is a matter of time" before the number of construction workers nationwide could fall below the 2 million mark, potentially impacting the entire job market.