[Worst in 22 Years of Employment] COVID-19 Hits Vulnerable Groups Harder... Women, Low-Educated, and Non-Regular Workers Break the Chain

Statistics Korea Announces December 2020 and Annual Employment Trends
Employment Vulnerable Groups Hit Relatively Harder
Clear Trend of Rapid Increase in 'Nahollo Sajangnim' in Self-Employment Market

[Sejong=Asia Economy Reporters Kim Hyunjung and Joo Sangdon] The novel coronavirus infection (COVID-19) first broke the weakest links in the labor market. Groups relatively vulnerable such as women, youth, non-regular workers, and those with low educational attainment experienced deeper unemployment, and most of the jobs that appeared in the market were short-term part-time jobs or public jobs created through taxes. The third wave of COVID-19 and accumulated fatigue make it difficult for employment-related indicators to improve quickly this year, which is also a concern.

According to the 'December 2020 and Annual Employment Trends' released by Statistics Korea on the 13th, the groups whose employment conditions deteriorated most sharply last year were summarized as women, youth, low-educated individuals, and non-regular workers. Although almost all employment-related indicators worsened last year, these groups faced the employment freeze caused by the COVID-19 crisis on the front lines.

◆ The weakest links broke first... COVID-19-induced employment cliff becomes reality = COVID-19 was harsher for vulnerable employment groups. Non-regular workers, who contrast with stable regular employees, are representative. The number of employed temporary workers (-313,000) and daily workers (-101,000) sharply declined; the decrease in temporary workers was the largest since statistics began in 1989, and the decrease in daily workers was the largest since 2012 when it dropped by 127,000. Although the number of regular employees increased by 305,000 compared to the previous year, it was the smallest increase since 2005 (272,000).

Looking at gender, the impact on economically active women was greater than on men. Last year, the number of employed men (15,381,000) decreased by 82,000 compared to 2019, and the number of unemployed men (624,000) decreased by 3,000, but during the same period, the number of employed women (11,523,000) decreased by 137,000, and the number of unemployed women (484,000) surged by 47,000. Based on the unemployment rate, men showed no change from the previous year (3.9%), but women’s rate rose by 0.4 percentage points to 4.0%.

The scale of unemployed by education level showed a similar trend. Last year, the number of unemployed with middle school education or less increased by 13,000, and high school graduates increased by 32,000 compared to the previous year, but the number of unemployed with college education or higher decreased by 1,000. While the unemployment rates for middle school or less (4.2%) and high school graduates (4.5%) each rose by 0.4 percentage points, the unemployment rate for college graduates or higher (3.5%) remained unchanged.

By age group, improvements were seen mainly in public jobs created through taxes. Last year, the number of employed decreased in the 30s (-165,000), 40s (-158,000), 20s (-146,000), and 50s (-88,000), but increased by 375,000 only in those aged 60 and over. In particular, the youth (ages 15?29) unemployment rate rose to 9.0%, returning to the 9% range for the first time in two years since 2018 (9.5%).

Among non-wage workers, only 'solo entrepreneurs' surged. This is interpreted as a result of the minimum wage increase and the impact of the COVID-19 crisis. The number of self-employed with employees decreased by 165,000 compared to the previous year, but the number of self-employed without employees increased by 90,000.

◆ December indicators worsened further... rapid rebound this year unlikely = The intensity of the COVID-19 employment shock was strongest in December last year due to the social distancing level being raised to 2.5. The number of employed persons aged 15 and over in December was 26,526,000, down 628,000 from the same month the previous year. The decrease was 152,000 more than in April of the same year (-476,000), when the employment shock was the largest. The decline that began in March last year (-195,000) continued for 10 consecutive months until December, marking the second-longest consecutive decline after the 16-month streak recorded immediately after the IMF financial crisis (January 1998?April 1999).

Along with the decrease in employed persons, the employment rate also plummeted. The employment rate for those aged 15 and over was 59.1%, down 1.7 percentage points from the same month the previous year. This was the lowest since December 2012, when it was 58.6%, and the largest drop since February 1999 (-2.5%). The employment rate for ages 15?64, the OECD comparison standard, also fell by 1.8 percentage points to 65.3% compared to the previous year.

On the other hand, the number of unemployed persons continued to increase for eight consecutive months. In December alone, 1,135,000 people were unemployed, an increase of 194,000 from the same month the previous year. The increase in unemployed was also the largest in the year. The unemployment rate rose by 0.7 percentage points to 4.1% compared to the previous year. Particularly, the employment auxiliary indicator 3 (expanded unemployment rate), which reflects the perceived unemployment rate, soared to 14.6% for all ages and 26.0% for youth (ages 15?29) in December last year. Both are the highest levels since related statistics began in January 2015.

The situation is expected to remain difficult in early this year as well. Jung Dongmyung, Director of the Social Statistics Bureau at Statistics Korea, said, "The impact of raising social distancing to level 2.5 on December 8 last year was reflected, but the January survey period is from January 16," adding, "If the level is maintained until the 17th, this will have an effect."