Korea's working-age employment rate reaches all-time high

Economy

Published: 12 Jun. 2024, 17:20

Korea's working-age employment rate reaches all-time high

Seo Woon-joo, head of the social statistics division at Statistics Korea, speaks during a press briefing on the employment report at the Sejong government complex on Wednesday. [NEWS1]

The employment rate of Korea's working-age population reached an all-time high of 70 percent in May despite growth decelerating to a 39-month low.

The number of employed people among the younger generation continued to retreat, mainly due to the country's shrinking population, while older workers drove the increase.

The employment rate of the working-age population aged between 15 and 64 — an Organisation for Economic Cooperation and Development standard for statistical comparison — rose by 0.1 percentage points from a year earlier to 70 percent in May, a record increase, according to Statistics Korea on Wednesday.

However, the total number of employees increased by only 80,000 from the same period last year, bringing the total employed population to 28.91 million — the slowest growth rate since February 2021.

Among those aged 15 and older, the employment rate stood at 63.5 percent, unchanged from the same period last year.

However, the employment rate of the 15-to-29 demographic fell 0.7 percent on year to 46.9 percent.

The unemployment rate of the economically active population rose 0.3 percentage points to 3 percent, increasing across all age groups. The growth was particularly steep among the younger generation, rising 0.9 percentage points to 6.7 percent.

The number of employed people shrank at its steepest pace among the younger age group, where the figure fell 173,000 on year. Those in their 40s also saw a decrease of 114,000, while those aged 60 and older recorded a significant increase of 265,000.

“The number of employees among the younger generation has been on a steady downtrend, mainly affected by the shrinking population,” said Seo Woon-joo, head of the social statistics division at Statistics Korea, during a press briefing held at the Sejong government complex.

By industry, the social and health service sector added 94,000 new employees, up 3.2 percent, and the hospitality and food service sector 80,000, up 3.5 percent. Retail and wholesale shrank by 2.2 percent, or 73,000 employees, and the construction sector shed 2.2 percent, or 47,000 employees.

Statistics Korea attributed the slow growth to May's quantity of national holidays and the base effect of last year's significant increase in employees driven by the decline of Covid-19.

Unfavorable weather conditions also contributed to hiring decline in the agricultural sector.

“The employment rate of those aged between 15 and 64 reached 70 percent for the first time in May, but the decrease in hiring from the retail, wholesale and construction sectors led to slower growth in the number of employed [people] while vulnerable groups in the job market continued to struggle,” said Kim Byoung-hwan, the first vice minister of the Ministry of Economy and Finance, during a job market monitoring meeting held Wednesday.

Nevertheless, the vice minister said factors that contributed to the deceleration were largely temporary, adding that “the improving domestic demand indicators, including exports, card spending, and the number of foreign tourists, will work in favor of employment” in June.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]