Korea’s jobless rate fell last year from a year earlier, but its labor markets remain tough amid worries over a slowing economic recovery, a report showed Wednesday.
The jobless rate stood at 3.4 percent in 2011, down 0.3 percentage points from a year earlier, according to the report by Statistics Korea. It is the lowest in three years.
The report showed that the economy added 415,000 more jobs last year compared to the previous year, a jump from 323,000 jobs gained on-year in 2010.
In December, however, the jobless rate inched up to 3 percent from 2.9 percent in the previous month. About 441,000 jobs were added to payrolls during the month, down from 479,000 in November, the report showed.
The government assessed that the 2011 job creation figure is much higher than its earlier forecast, and the labor market seems to be improving despite economic uncertainties.
“Last year’s job creation is the largest level in seven years,”
Finance Minister Bahk Jae-wan told a crisis management meeting with other policymakers. “Things are steadily improving despite uncertainties lingering at home and abroad.”
The job data, however, comes amid growing uncertainties over the overall economic conditions, which could encourage businesses to reserve their plans to invest and hire for the time being, experts said.
The lingering eurozone fiscal debt crisis and a possible worldwide global slowdown, among other things, could come as major risk factors for Korea’s export-dependent economy.
Mindful of such gloomy forecasts, the government recently revised down its growth outlook for this year from 4.5 percent to 3.7 percent. That is also lower than a 3.8 percent gain projected for last year.
In his New Year’s speech, Finance Minister Bahk said he expects economic conditions to become “difficult and uncertain” in 2012.
The government has prepared contingency plans to better cope with any unexpected shocks at home and abroad.
Job creation is a top priority for the government, which worries that an anemic labor market could put a damper on economic recovery by resulting in less household income and weak consumption in the private sector.
In particular, hiring situations for younger people remain tougher compared with other age groups, the report showed.
The unemployment rate for those aged between 15 and 29 stood at 7.7 percent in December, up from 6.8 percent from a month earlier, according to the report. It is the highest in eight months.
The “economically inactive” population, which includes those who give up looking for a job, also stood at 16.39 million in December, up from 15.89 million in November. It is also higher than 16.25 million a year earlier.
Experts said that the job market conditions will likely remain unfavorable for the time being given the uncertainties hanging over the economy at home and abroad.
“The reason why the 2011 jobless rate fell from a year earlier is mainly due to the quite bad labor market conditions back in 2009 and 2010 in the wake of the global financial crisis,” said Huh Jae-wan, an analyst at Daewoo Securities Co.
“Affected by growing uncertainties, many large businesses are announcing very conservative investment plans for this year and a large part of the plans is also intended for spending on facilities. Job market situations will not likely improve for quite some time.”
(Yonhap News)
