Unemployment insurance claims surged to a record high last month in South Korea as the job market continues to suffer from a weak economy.
Claims for unemployment benefits totaled 738.2 billion won ($621.4 million) in April, up 35.4 percent from the same month a year earlier, according to the Ministry of Employment and Labor on Tuesday. This was 98.5 billion won higher than the previous record high of 639.7 billion won in March.
The number of claimants climbed 14.2 percent to 455,000 over the same period. Average payment per person was 1.42 million won, up from 1.19 million won a year earlier.
The unemployment insurance program added 97,000 new claimants last month, up 7,000 from the year-ago period, driven largely by troubled sectors like construction (21,000), retail and wholesale (14,000), and restaurant and accommodation (11,000).
The ministry attributed the surge to the sluggish construction market and job migration to expanding social services and IT sectors.
The number of claimants in construction jumped 32.7 percent year over year to 63,000 in April, reflecting an industry-wide slump. The value of construction work completed by Korean builders was 26.76 trillion won in the first quarter of 2017 and 26.98 trillion won in the same period of 2018. But as new orders dried up from the flagging economy, the figure slipped to 24.74 trillion won in the first three months of this year.
Many also quit jobs to move to more promising social services and IT communications sectors, where monthly job additions have been on a steady rise since January 2018. Health and social welfare services added 72,000 jobs in April, up 16.1 percent from a year earlier. Jobs in IT communications also gained 18.9 percent to 13,000.
Korea’s jobless rate hit a nine-year high of 4.5 percent in January, with monthly job gains hovering near 100,000 throughout last year. Employment figures recovered slightly in February and March as job additions averaged 200,000. But the manufacturing sector continued to shed jobs in March, extending the decline for 12 straight months.
Asia’s fourth-largest economy unexpectedly contracted in the first quarter, marking its worst performance since the global financial crisis. Gross domestic product shrank 0.3 percent from the previous three months as mainstay exports slumped and demand cooled from its largest trading partner China.
By Chung Seok-woo and Kim Hyo-jin
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]