Nation’s unemployment climbs to an 11-year high

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Nation’s unemployment climbs to an 11-year high


The unemployment rate rose to its highest level in 11 years due to the manufacturing sector that has weakened from ongoing corporate restructuring in the shipping and shipbuilding industries.

In October, the unemployment rate rose 0.3 percentage points year on year to hit 3.4 percent, its highest level for the month since 2005, the government said on Wednesday.

The number of jobs available in the manufacturing sector continues to rapidly decrease due to restructuring and weakened exports.

The data showed that the number of employees in the manufacturing sector dropped 2.5 percent year on year, or 115,000, to 4.44 million. The 115,000 decrease was the highest since September 2009, when it dropped 118,000 compared to the previous year.

“The unemployment rate in regions where corporate restructuring is currently going on, such as southern port city of Ulsan and South Gyeongsang, continued to increase,” said Kim Ie-han, a director at the Ministry of Strategy and Finance.

The youth unemployment rate, or the figure for those ages 15 to 29, was 8.5 percent last month, also hitting a high since 8.6 percent that was recorded in 1999, which was when the country was hit by the financial crisis.

“More young Koreans are becoming economically active, or willing to get involved in the workforce or find jobs, and the number of newly hired rose by 31,000 last month compared to the previous year,” said Kim.

The unemployment rate, on the other hand, increased for young job seekers, as the number of people who failed to find jobs among the economically active population was still higher than those who found new jobs.

Young people are not being able to find suitable jobs as their standards on working environments differ from what employers are offering, according to the Korea Employment Information Service on Monday.

The data showed that the number of Koreans who are unemployed for more than six months rose 62,000 year on year to 182,000 in August, accounting for 18.3 percent of the total number of unemployed.

Among those who were unemployed for more than six months, those ages 15 and 29 accounted for 44 percent of the total. The number was up 10 percentage points from the last year’s 34.3 percent.

“Employers said they are not hiring as many job seekers since they do not meet the requirements that the companies want such as education level,” the report said.

According to the data, 46.2 percent of the long-term unemployed graduated from college but only a quarter of the employers are looking for those with such degrees.

Meanwhile, the employment rate rose 0.3 percentage points year on year to 66.5 percent in October, increase for the 41st consecutive month.

The employment rate rose in all age groups, except for those in their 30s and 40s, according to Statistics Korea. The employment rate for people in their 30s remained unchanged as the overall population dropped by 89,000 year on year.

Even though the manufacturing sector struggled, the construction and services sectors have improved.

The services sector saw the number of employees grow 390,000 year on year and the construction sector increased by 59,000.

The government also has warned that various uncertainties might take a toll this year and drag down the labor market as well.

“There are risks including the ongoing corporate restructuring that has been expanding and the recently passed antigraft law, the so-called Kim Young-ran Act, might have negative impacts as well,” said Kim at the Finance Ministry. “The government will try to minimize the negative impact coming from them through various policies including a 10 trillion won [$8.66 billion] financial stimulus package.”

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