South Korea’s Year-on-Year Job Growth Slowest in 29 Months in July


South Korea’s year-on-year job growth slowed for the fourth consecutive month in July, with the fewest number of jobs being added in 29 months, according to data released Wednesday. This was attributed to a sluggish employment in the manufacturing and construction sectors.

The number of employed people in the country totaled 28.68 million in July, an increase of 211,000 compared to the same month of the previous year. The unemployment rate for the month was 2.7%, the lowest since 1999.

Year-on-year job growth had risen in March, but has been declining since April. People aged 60 and above saw a rise of 298,000 jobs, while those aged 50 and above increased by 61,000. However, employment for people in their 20s and 40s decreased by 128,000 and 61,000 respectively.

The welfare and social service sector added 145,000 jobs, while the accommodation and restaurant industry saw an increase of 125,000 as more people returned to pre-pandemic activities. There was also an increase of 62,000 jobs in the science and technology field.

However, the retail and wholesale industry saw a decrease of 55,000 jobs, and the construction sector lost 43,000 positions due to the economic slowdown. The manufacturing sector also had a drop of 35,000 jobs, the seventh consecutive month of decline. The agricultural industry declined by 42,000.

The employment-to-population ratio for South Koreans aged 15-64 increased 0.5 percentage points to 69.6%, the highest since 1989. The finance ministry estimated that the number of employed people would rise by 320,000 year-on-year each month in 2023, significantly higher than the previous estimate of 100,000.

The Bank of Korea kept its key interest rate unchanged at 3.5% for the fourth consecutive time in July. Prior to that, the central bank had increased the rate seven times from April 2022 to January 2023.

The finance ministry said that South Korea was expected to maintain stable job data in the future, buoyed by the service and health care sectors. However, the growth margin is expected to slow due to the sluggish performance of the construction and manufacturing sectors. Harsh weather conditions in August, such as the heat wave and typhoons, are also likely to affect employment in the agricultural industry.

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