Employment-to-GDP ratio hits a record lowThe employment-to-gross domestic product (GDP) ratio fell to a fresh record low last year, data showed Sunday, as the Korean economy experiences technology-led development.
The ratio measures the number of newly employed workers per 1 billion won ($878,000) of GDP, a gauge of people finding work in proportion to economic growth.
Data from the Bank of Korea (BOK) and the Korea Employment Information Service put the ratio at 16.79 last year, down to a new record low from 17.18 in the previous year.
The ratio was 43.1 in 1990. It fell to 29.6 in 1997, and since dipping to under 20 at 19.9 in 2009, it hasn’t rebounded.
The speed of the fall is most alarming. The ratio lost 0.39 last year, marking the largest on-year drop since 2010 in the aftermath of the 2008 global financial crisis. The gap between growth in the national economy and in employment was also widening, according to the data.
In 2017, Korea’s economy grew 3.1 percent, but the number of employed rose 1.2 percent. Last year, GDP expanded 2.7 percent, while employment edged up 0.36 percent.
The difference between the two expanded to 2.34 percentage points in 2018 from 1.9 percentage points in 2017. Economy watchers say the ratio naturally falls with technological development as machines replace humans at production facilities.