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[News Focus] Gyeonggi, Sejong see unemployment-payouts surge

SEJONG -- More than 3 million of the working-age population, aged 15-64, in South Korea have been de facto out of work, while the government highlighted that the nation’s jobless people stayed under 1 million (864,000) last month with official unemployment rate falling to 3 percent.

According to the Supplementary Index for Employment III, a database held by Statistics Korea, the extended (or sentiment-reflected) jobless rate posted 10.6 percent as of October 2019.

The figure is generated from about the number of de facto unemployed totaling 3.17 million out of the extended working-age population of 29.95 million.

The 3.17 million people include those “underemployed” workers, such as temporary employees who work fewer than 36 hours a week and want full-time employment, as well as seasonal workers who are out of work for part of the year.
Applicants for unemployment payouts wait in line to take a briefing-session class at a regional office of the Korea Employment Information Service in Seoul. (Yonhap)
Applicants for unemployment payouts wait in line to take a briefing-session class at a regional office of the Korea Employment Information Service in Seoul. (Yonhap)

The International Monetary Fund also pointed out -- earlier this year -- that the official jobless rates in Korea did not reflect the real situation in the market. Like the Washington-based organization’s research, the Korean government regards temporary or part-time job workers as employed in its broader figure.

Though the Economy-Finance Ministry or Employment-Labor Ministry claim the employment index has improved, a tough hiring market is seen in the statistics for state-led unemployment benefits for the jobless.

Data from the Korea Employment Information Service shows that the weak job market has led the government to pay out ever-higher amounts in benefits for those who lost their jobs, under the employment insurance system.

According to the KEIS, the number of unemployment benefit claimants came to 671,290 nationwide during the third quarter of 2019. This marked a 20.4 percent increase in two years from 557,336 in the third quarter of 2017, or months after President Moon-Jae-in took office in May 2017.

Five of the eight metropolitan cities had rates of increase that exceeded the nationwide average.

Sejong topped the list with a 58 percent increase from 2,170 people to 3,430 over the corresponding two-year period.

Gwangju ranked second among the eight cities as it saw the number of recipients climb 26.7 percent from 14,299 to 18,121, followed by Daejeon with 22.9 percent from 15,994 to 19,667.

Incheon (the nation’s third-largest city) and Daegu (the fourth-largest) recorded a growth of 26.3 percent and 23.9 percent, respectively.

The recipients in Seoul and Busan tallied 126,695 and 52,429 recipients in the third quarter of 2019. The nation’s largest and second-largest cities recorded 13.5 percent and 17.2 percent increases, respectively, compared to two years earlier.
(Graphic by Kim Sun-young/The Korea Herald)
(Graphic by Kim Sun-young/The Korea Herald)

Gyeonggi Province -- which has the largest population (13.2 million) among Korea’s 17 major areas (eight cities and nine provinces) -- reported a growth of 28.8 percent in the number of recipients for the unemployment payouts over the corresponding period -- from 135,210 to 174,207.

As Gyeonggi has 28 cities, and 16 of them have a population of more than 300,000 each, labor-related indices in the province could be a barometer for the economic situation across the country.

While 16 of the 17 major regions reported an increase in the number of claimants, only Ulsan saw the number fall, down 1.9 percent to 18,050 over the two years.

A labor market research fellow suggested it was necessary to look into deviations by region: between Seoul and other metropolitan areas such as Gyeonggi Province, Daegu, Gwangju and Daejeon.

“The economic slowdown and drastic hikes in the minimum wage are thought to have dealt a tougher blow to self-employed people in satellite cities and regional big cities, than those in Seoul,” he said.

Apart from the comparison data with two years earlier, the 2019 figure showed an on-year increase, according to the KEIS data. The number of Koreans receiving the state-led unemployment payouts has increased by 62,500 over the past year, up 10.2 percent from 608,790 in the third quarter of 2018.

By Kim Yon-se (