The rapid rise of online transactions in South Korea in recent years has pulled down prices but resulted in less jobs in the retail sector, according to the country’s central bank report on Tuesday.

The rise in the country’s online transactions is estimated to have contributed to a drop of 0.2 percentage points in core inflation, which excludes fresh food and energy prices, on an annual average since 2014. It is also estimated to have reduced about 16,000 jobs annually in the wholesale and retail sectors.

The Bank of Korea’s report showed that the core inflation rate declined 0.02 to 0.03 percentage point for every 1 percentage point rise in the share of online product sales. When applying actual online share increase from 2014 to 2017, the report said the core inflation rate fell by an annual average of 0.2 percentage points.

The BOK also analyzed the impact of online transactions on the country’s employment to figure out how offline sales and jobs in the wholesale and retail sectors were affected in the first half of in between 2014 and 2018. Its analysis showed that the number of jobs fell by an annual average of 16,000 over the past five years. The analysis only took into account wholesale and retail sector jobs offline without considering jobs that could increase rather as a result of rising online trading such as in the information technology and distribution sectors.

The volume of online trading in Korea has increased significantly since 2014 on rising smartphone penetration and easier mobile and online payment options. Data showed online sales contributed to a 83.9 percent increase in annual retail sales in between 2014 and 2017.

By Lee Yu-sup and Lee Eun-joo

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