Rising Long-Term Unemployment in South Korea Raises Concerns
According to the Korea National Statistical Office (KOSIS), as of the end of August, the number of unemployed individuals in South Korea stands at 564,000. Among these, 113,000 have been jobless for more than six months, making up 20.0% of the total. This marks the highest percentage of long-term unemployment since August 1999, when it was 20.1% amid the Asian financial crisis.
Long-term unemployment surged during the COVID-19 pandemic, peaking at over 100,000 from October 2020 to July 2021. While it subsequently declined to below this threshold, there has been a renewed upward trend since March. As of July, year-over-year figures showed a double-digit increase, indicating a troubling trajectory.
Interestingly, while the overall number of unemployed has decreased since July, the increase in long-term unemployment suggests a growing disparity. This rising figure reflects a phenomenon known as "job mismatch," where individuals are unable to find jobs that meet their expectations or skill levels, extending their job search durations.
Data from the Economic Activity Population Survey highlights that among long-term unemployed individuals who had worked for less than a year, 24.7% cited dissatisfaction with "working conditions such as hours and pay" as the reason for leaving their previous job. This was the second most common reason, following "completion of temporary or seasonal work" at 26.4%. Notably, dissatisfaction with working conditions was the leading reason for those who left their jobs.
This trend is closely related to the significant rise in individuals identifying as "not in the labor force." As of August, the number of people in this category who reported being "not working" increased by 245,000 (10.6%) compared to the previous year, totaling 2.567 million. This is the highest number recorded for August since statistics began in 2003. Those identifying as "not in the labor force" include individuals without any intention of seeking employment and those who, despite wanting a job, have ceased looking due to a lack of suitable opportunities.
Among long-term unemployed individuals who had worked for less than a year, the majority came from sectors such as retail (18.9%), manufacturing (15.9%), and healthcare and social services (13.7%).
Journalist’s Perspective
The current unemployment crisis in South Korea paints a complex picture of economic health. While the overall unemployment rate appears to be declining, the increase in long-term joblessness signals underlying structural issues in the job market. It’s crucial for policymakers to address the mismatch between job seekers’ expectations and available positions. As South Korea moves forward, fostering a more adaptable workforce and improving job matching processes should be top priorities. Without these measures, the rise in long-term unemployment may become a permanent feature of the labor landscape, posing significant challenges for economic growth and social stability.
