Jobless benefits reach record highUnemployment benefits paid in March hit an all-time high as jobs shrink due to the coronavirus outbreak.
According to the Ministry of Employment and Labor on Monday, unemployment benefits paid in March amounted to 898.2 billion won ($737.5 million), a 40.4 percent surge compared to the same period a year earlier and a new record. The previous record was 781.9 billion won in February.
The number of people applying for unemployment benefits last month was 156,000, a 24.8 percent increase or 31,000 more compared to a year ago.
“It is the largest rise in the number of people applying for unemployment benefits since March 2009, when it jumped 36,000 [compared to the previous year],” said Lim Seo-jeong, vice employment and labor minister. That month, 109,191 people applied for benefits.
When compared to the previous month, the increase in people applying for benefits was 45.8 percent.
The employment insurance system that pays the benefits is not open to daily workers or freelancers, meaning that the unemployment situation is not fully reflected in these figures.
“The impact of Covid-19 is expected to be much worse for those in vulnerable situations including daily hires and the self-employed, who are not covered by employment insurance,” said the Vice Minister Lim.
Statistics Korea will be announcing job statistics on Friday.
The services sector was hit hardest.
According to the ministry’s latest figures, 35,000 people in the health and welfare industry including small private hospitals applied for unemployment benefits in March. It did not say how that compared to any earlier period.
The health and welfare industry was the driving force behind recent upticks in employment figures, largely thanks to jobs created by the government for older workers.
Manufacturing trailed behind with 19,000 filing for unemployment benefits, while 16,000 people in the construction business filed.
Some 15,000 in the wholesale and retail trades applied, followed by the education industry with 15,000.
While filings for benefits spiked, the number of new subscribers to the system grew at the slowest pace in 16 years, which signals that businesses and companies are not hiring.
Last month the number of people subscribing to employment insurance amounted to 13.75 million, a 1.9 percent increase or 253,000 more than a year earlier.
That’s the smallest number of new subscribers since 237,000 in May 2004, when the country was slammed by a credit card crisis.
The manufacturing industry’s subscribers fell 0.9 percent compared to a year ago or 31,000 less. Service sector subscribers saw a 3 percent increase.
BY LEE HO-JEONG [email@example.com]