President Moon Jae-in suddenly replaced the commissioner of Statistics Korea on Sunday.
Previous commissioners had held the post for about two years, but Hwang Soo-kyeong was dismissed as head of the agency after little more than a year. Cheong Wa Dae offered no explanation.
There is strong suspicion that the decision to sack Hwang is related to the latest statistics on household income. According to Statistics Korea, household income for the bottom 20 percent of income earners plunged 8 percent and 7.6 percent year-on-year in the first and second quarters, respectively. These figures show income and income inequality worsening in the face of higher unemployment since a sharp hike in the minimum wage.
When first-quarter statistics on household income were released in May, Hwang is said to have been reproved by Cheong Wa Dae for failing to clarify that the sample size had changed. Cheong Wa Dae reportedly argued that because the survey sample had increased from 5,500 households last year to 8,000 this year, it may have included a disproportionately large number of low-income households.
However, Finance Minister Kim Dong-yeon said during a recent National Assembly session, “I don’t agree with the view that the wider income disparities appeared due to sampling errors. It is not appropriate to blame the commissioner for them.” Experts say the sample used in the household income survey fairly represents the population as a whole.
Employment and income statistics have slid downhill this year. Unemployment skyrocketed to an 18-year high in May, and the number of unemployed surpassed 1 million for the seventh straight month last month. Last year, each month saw an increase of about 300,000 jobs on average, but that figure dropped to 5,000 last month.
When misguided economic policies bring about dire consequences, policymakers must be held responsible. In this case, instead, it is the Statistics Korea commissioner who was sacked.
After the May statistics were revealed, Cheong Wa Dae ordered a reanalysis. The Korea Institute for Health and Social Affairs submitted a report to Cheong Wa Dae showing that earned income for individuals had declined only for earners in the bottom 10 percent. The institute is said to have reinterpreted the household income survey after extracting data only for wage earners. Based on this later report, Moon concluded that the effects of the minimum wage hike were 90 percent positive.
A senior research fellow with the Korea Institute for Health and Social Affairs -- the same person who questioned the household income survey that Statistics Korea announced in May, proposing a redesign of the analysis and a reinterpretation of the statistics -- is now the new commissioner of the agency.
If it is true that Kang Shin-wook, the above-mentioned researcher, was appointed to lead Statistics Korea as a reward for helping to fit the data to Cheong Wa Dae’s expectations, that is a serious problem.
Statistics Korea is an agency that produces a wide array of social and economic data, which the government uses to formulate its policies. As an agency, it must be neutral on government policy matters.
Officials, including the commissioner of Statistics Korea, can be replaced, but there is no doing up data.
“I have tried to prevent statistics from being politically used,” Hwang said at a farewell ceremony on Monday. “I was not an obedient type.” Her remarks sound significant.
It is not the role of the Statistics Korea commissioner to prove the effectiveness of key government policies by reworking statistics. A national statistics body exists to ensure the independence and accuracy of statistics. If statistics are contaminated by those in power, unrealistic policies will continue and the economy will be brought to the brink of ruin.
The sudden dismissal of the Statistics Korea commissioner sends a signal to the staff of the agency that its members should strive to uncover data that is more agreeable to the government -- or even touch up the data, if necessary. Now, if they release new statistics showing that employment, income and income distribution trends have improved, how many people are going to trust them? Who will take those statistics at face value?
Customized statistics are a broken compass. The government must resist the temptation to “prove its policies right” by spinning statistics. Statistics Korea is not a publicity agency.