South Korea’s jobless rate surged to its highest in more than two decades, raising concern that an export-driven recovery could be masking a harsher scarring of the economy.
The unemployment rate jumped to 5.4 percent last month from a revised 4.5 percent in December last year, hitting its highest level since after the Asian financial crisis.
The result outstripped all forecasts as the economy shed almost 1 million jobs from a year earlier for the worst losses since 1998.
The sharp deterioration in the labor market contrasts with the view that the South Korean economy has been one of the best performers in the developed world last year and suggests that the South Korean government might need to take more action to support jobs.
“The huge hit to jobs is going to weigh on the pace of economic recovery,” said Sung Tae-yoon, an economics professor at Yonsei University in Seoul. “People looking for jobs will also decrease as the economy worsens, which may technically bring down the jobless rate, but economic difficulties will continue.”
Last month, the sector combining retailers, wholesalers, restaurants and hotels was hit hardest with 585,000 job losses from a year earlier.
More than 340,000 positions were shed in a sector that includes public service, as the government’s job-creation measures expired. Manufacturing lost 46,000 jobs.
The government takes the situation “seriously” and would use all available options to deal with it, South Korean Minister of Finance Hong Nam-ki said in a statement, blaming the job losses partly on expired fiscal support for jobs creation at the turn of the year, and a high year-earlier base.
South Korean President Moon Jae-in is also calling for incentives for companies that would share some of their profits during the pandemic with ones that were hit harder, a move that could indirectly support employment.
Some South Korean lawmakers are putting pressure on the Bank of Korea to adopt a jobs mandate as part of its goals.
To many, Tatu City on the outskirts of Nairobi looks like a success. The first city entirely built by a private company to be operational in east Africa, with about 25,000 people living and working there, it accounts for about two-thirds of all foreign investment in Kenya. Its low-tax status has attracted more than 100 businesses including Heineken, coffee brand Dormans, and the biggest call-center and cold-chain transport firms in the region. However, to some local politicians, Tatu City has looked more like a target for extortion. A parade of governors have demanded land worth millions of dollars in exchange
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) revenue jumped 48 percent last month, underscoring how electronics firms scrambled to acquire essential components before global tariffs took effect. The main chipmaker for Apple Inc and Nvidia Corp reported monthly sales of NT$349.6 billion (US$11.6 billion). That compares with the average analysts’ estimate for a 38 percent rise in second-quarter revenue. US President Donald Trump’s trade war is prompting economists to retool GDP forecasts worldwide, casting doubt over the outlook for everything from iPhone demand to computing and datacenter construction. However, TSMC — a barometer for global tech spending given its central role in the
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
RSS