Covid-19 pushes employment numbers down by 218,000 in 2020
Last year 218,000 fewer people were employed in Korea compared to 2019, the biggest decline in more than two decades since the IMF crisis of the late 1990s.
The impact of Covid-19 on the job market is expected to continue in the first two months of this year, forcing the government to take a more aggressive approach including swift budget spending and hiring in the public sector.
According to Statistics Korea on Wednesday, at the end of 2020 there were 26.9 million people employed, 218,000 fewer than a year ago.
It was the biggest annual loss of jobs since 1998, when 1.27 million people became unemployed.
December alone saw the biggest loss of jobs in more than two decades. Last month there were 628,000 fewer people employed than the same month a year earlier. That’s the biggest year-on-year loss since February 1999, when 658,000 jobs evaporated.
Job losses have been continuing for 10 consecutive months.
Across the whole year, jobs that requires face-to-face services suffered the worst.
In wholesale and retail, 160,000 fewer people were employed, while in restaurants and accommodation the figure was 159,000. Education services including private cram schools lost 86,000 jobs.
Even the manufacturing industry, which is the leading job creator, saw 110,000 fewer people employed.
The number of unemployed people exceeded 1 million for a fifth consecutive year, while the number of people that are on temporary leave hit 837,000, an all-time high since data first began being compiled in 1980.
In December alone, restaurants and accommodation were hit the hardest as the number of people employed in the industry dropped by 313,000. Wholesale and retail came in second with 197,000 and manufacturing at 110,000.
The statistics agency cited the heightened social distancing measures as the third wave of coronavirus spread across Korea as the main contributor affecting the job market.
Finance Minister Hong Nam-ki raised concerns over the figures.
“With the third spike of coronavirus, the job market has worsened,” Hong said.
He projected that the situation will continue for the first two months of this year.
“Especially as the job entry of vulnerable people including young people and women has become difficult and their income has shrunk, there’s a growing concern on the widening inequality and [income] gap,” Hong said.
The Finance Minister said the government will spend 5.1 trillion won ($4.6 billion) of its budget within the first quarter of this year, 38 percent of the government’s job budget for the year, to create 830,000 jobs that exclusively hire people who struggle to find work, including people from low income households, people with disabilities, North Korean defectors and homeless people.
Such jobs include managing public facilities like parks and stadiums, consultation centers for young people and alcoholics and child welfare centers.
The government last year created a budget of 30.6 trillion won for this year to be spent on creating 1.04 million jobs.
Not only was the job budget a 20 percent increase from 2020’s 25.5 trillion won, it was double the 15 trillion won in 2017 when the Moon Jae-in government took over.
The Finance Minister also said this year the public sector will hire at least 45 percent of its targeted hiring for the year within the first half.
“We will act quickly in the first quarter by hiring 22,000 interns,” Hong said.
Meanwhile, the Finance Minister at the meeting said in just two days over 2 million small shop owners have received the government's third emergency relief grant.
That’s 76 percent of the government target.
“We are quickly giving out the grant so that those that apply in the morning will be able to receive the money by the afternoon,” Hong said. “We will move quickly so that the rest can receive it as early as possible.”
BY LEE HO-JEONG [email@example.com]
More in Economy
Biden boomlet expected for 5 key exports
WTO rules in favor of Korea in dispute over U.S. tariffs
Public sector job growth outpaces private sector growth
Exports up 10.6 percent in first 20 days of 2021
Down with the Cptpp!