Manufacturing Employment Decreased by 58,000 in Q3... Largest Drop in 11 Quarters

The number of manufacturing sector employees in the third quarter decreased the most in 11 quarters, indicating a deepening slump in manufacturing employment.

According to the National Statistical Portal of Statistics Korea on the 22nd, the average monthly number of manufacturing employees in the third quarter of this year was 4,466,000, down 58,000 from the same quarter last year.

This is the largest decline since the fourth quarter of 2020, when the number dropped by 107,000 amid the spread of COVID-19.

In terms of monthly figures this year, the largest decrease in manufacturing employment was in April (97,000), but the decline continued at around 70,000 in August and September, making the third quarter the weakest on a quarterly basis.

Manufacturing employment, which had been sluggish during the pandemic, seemed to recover with increases of 214,000 in the third quarter and 129,000 in the fourth quarter of last year, but it turned negative for the first time in six quarters with a decrease of 37,000 in the first quarter of this year. The decline widened further in the second quarter (-49,000) and continued into the third quarter.

Some expect that manufacturing employment conditions will improve as semiconductor production and exports have recently been recovering.

Semiconductor production in August increased by 13.4%, raising the industrial production index of the manufacturing sector by 5.5%, the largest increase in 3 years and 2 months. The decline rate of semiconductor exports in September (-13.6%) was also the smallest this year.

However, it is expected that it will take some time for the signs of recovery in the semiconductor sector to translate into a positive impact on the employment market, as the semiconductor manufacturing industry has a minimal employment inducement effect.

An official from the Ministry of Economy and Finance explained, "The decline in manufacturing employment continued due to the base effect from the large increase in employment last year and the decrease in manufacturing production."