Job statistics distort economic reality
Employment rate for 30s and 40s falls for 23 straight months
The gov’t is replacing manufacturing jobs with public and services sector jobs.
The latest employment data showed an improvement in the job market here but experts said that such data are not mirroring economic reality as job creation still remains sluggish in the manufacturing sector, particularly for those in their 30s and 40s.
Experts criticized President Moon Jae-in and his administration for being blindly optimistic about jobs and the economy calling for more fundamental solutions to fixing the distortion in the employment market.
According to data released by Statistics Korea, the nation’s employees totaled 27.35 million as of the end of August, up 452,000 from a year ago. This was the sharpest jump in two years and five months since Korea added 463,000 workers in March 2017.
The nation’s unemployment rate also dropped to its lowest level in nearly six years.
The Moon administration sang its own praises over the data, claiming Korea’s economy was “moving forward in the right direction despite unfavorable external factors.”
President Moon hinted in recent remarks that the government will thus continue pushing ahead with its signature income-led growth policy, but experts expressed concerns about the government’s lack of a sense of urgency.
They claimed the recent job additions can be attributed to the government’s spending to create temporary jobs in the public sector, whereas job quality has continued to worsen for more than a year.
Despite the job increases last month, Korea’s economy is still experiencing difficulties in creating quality employment.
The data suggested the nation’s social welfare services led the growth last month by adding 174,000 jobs in the sector from a year ago. The lodging and restaurant services sector also added 104,000 jobs.
In the meantime, 24,000 people lost manufacturing jobs, while the wholesale and retail sector shed 53,000 employees last month. The manufacturing sector continued its downtrend for the 17th consecutive month in July.
Korean Economic Association analyst Kim Jung-shik said the decline in the number of jobs in the manufacturing sector indicates firms, especially conglomerates, are still reluctant to recruit new employees as they believe the economy isn’t heading in the right direction.
“The manufacturing sector did not add jobs due to the deteriorating economy,” he said. “This indicates job quality is worsening, but the government is replacing manufacturing jobs with public and services sector jobs.”
Another negative sign is the decline in the number of the nation’s workers in their 30s and 40s.
The Statistics Korea data also suggested workers aged 60 and above accounted for 391,000 of the new jobs, while the number of workers in their 30s and 40s fell 9,000 and 127,000, respectively, last month from a year ago.
“Workers in their 30s and 40s are the backbone of the nation’s economy. The decline in the number of manufacturing workers indicates the government is still experiencing difficulty in creating quality jobs,” Yonsei University Professor Sung Tae-yoon said.