Jobs data shows gloomy market, high youth unemployment

South Korea’s number of jobless hit 1 million for the first time last year, with young job seekers suffering the most, the latest data from the national statistics bureau showed Wednesday. 

The unemployment rate for last year was 3.7 percent, the highest since 2010, inching up 0.1 percentage point from the previous year, with the number of jobless reaching 1.01 million, Statistics Korea data showed. It was the first time the tally had exceeded 1 million since the statistics agency adopted the current measuring method in 2000.

The data showed that while the unemployment rate declined among those in their 40s and 50s to 2.1 percent and 2.3 percent, respectively, the youth unemployment rate was on the verge of hitting the 10 percent mark.

The unemployment rate for those aged between 15 and 29 set a new record high, jumping to 9.8 percent, compared to 9.2 percent the previous year. The youth jobless rate has been climbing despite government efforts to create jobs for young people. The government spent 2.1 trillion won ($1.76 billion) to spur job creation for the young last year and most recently announced Monday that it had allocated another 2.6 trillion won toward those efforts.

A total of 26.23 million people were employed last year, 299,000 up from 2015. The increase lingered just below the goal of 300,000 set by the government in June. The number is the weakest since 2009, when some 72,000 jobs disappeared in the wake of the global financial crisis. The pace of job creation was slower than previous years after the financial crisis in 2009. In 2014, more than 530,000 jobs were created.

Worst hit was the manufacturing sector, which returned negative numbers for the first time in seven years. The negative trend has been in place since July. In December, 115,000 jobs in the manufacturing sector were wiped out.

Prospects for the sector remain gloomy.

The shipbuilding sector, which has been undergoing harsh restructuring, already let go a significant number of workers last year as orders for major shipbuilders declined. Daewoo Shipbuilding & Marine Engineering, for instance, might shed some 5,000 subcontracted laborers working on offshore plant construction as the company is to handover or complete half of its major projects within this year.

President Park Geun-hye’s pledge to accomplish a 70 percent labor force participation rate is likely to be unmet by the end of her term. The labor force participation rate, or the share of South Koreans over the age of 15 who are working or looking for a job, stood at 60.4 percent in 2016, up 0.1 percentage point on-year. It does not take into account those who have stopped looking for work.

But for the first time, the yearly labor force participation rate for women exceeded 50 percent.

Of the total population of 43.41 million people aged 15 and above, the economically active population marked 27.24 million in 2016.

By Park Ga-young (gypark@heraldcorp.com)