Korea’s inflation-adjusted average wage declined this year as income grew at a slower pace than in 2010, while inflation rose sharply, data showed Wednesday.
Korean worker’s real wage averaged 2.72 million won ($2,350) in the January-September period, down 3.49 percent from a year earlier, according to calculations based on data from the central bank, the labor ministry and the state-run statistics agency. Last year, the real wage grew 3.8 percent as the economy expanded 6.2 percent.
The real wage is calculated by the value of the nominal wage set against the consumer price index.
The 2011 data marked the third lowest level since the real wage declined 8.54 percent in 2008, when the country was in the midst of global financial turmoil. The real wage dropped 9.3 percent in 1998 when the Asian-wide financial crisis hit the nation.
A fall in the real wage came as South Korean workers’ income growth remained stagnant amid high inflation and slowing economic growth.
High inflation and a decline in real wage undercut household spending, hurting domestic demand and denting economic growth further.
The Bank of Korea said consumer inflation is expected to grow 4 percent this year, hitting the top end of its 2-4 percent inflation target band for 2010-2012.
The prospects for the economy are expected to be bleaker next year as the eurozone debt crisis and a slowing global economy increase economic uncertainty.
According to the central bank, the South Korean economy is forecast to grow 3.7 percent next year, slowing from a 3.8 percent growth estimated for this year.
Consumer inflation is likely to grow 3.3 percent in 2012, but the growth of inflation is expected to remain at 4 percent or above for the sixth straight month in December, indicating that inflation concerns will linger for some time.
The government said earlier it prioritize reviving economic momentum and stabilizing the livelihoods of low- and middle-income families in a bid to obtain sustainable growth.
(Yonhap News)
