Construction Industry Cold Snap Leads to Record High Job-Seeker Allowance Applications Last Month

90,000 New Job-Seeker Allowance Applicants in October
Increase in Application Days Affected by Construction Industry Slump

Last month, the employment insurance subscriber growth rate remained in the 1% range, continuing a low growth trend. The number of new job-seeker benefit applicants reached 89,000, marking the highest ever for October. Factors such as an increase of more than 3,000 new applicants in the construction industry due to economic sluggishness influenced this.

Employment Insurance Subscriber Growth Rate Remains in the 1% Range Since May

According to the 'Labor Market Trends Based on October 2024 Employment Administration Statistics' released by the Ministry of Employment and Labor on the 11th, the number of regular employment insurance subscribers as of the end of last month was 15.49 million, an increase of 208,000 compared to the same month last year.

The employment insurance subscriber growth rate has remained in the 1% range this year. It continued to decline from May (1.6%), June (1.5%), July (1.5%), August (1.4%), and September (1.3%), before slightly rebounding to 1.4% in October, but the growth rate is still lower than in the past. Compared to October 2022 (2.4%) and October last year (2.3%), there is a difference of more than 1 percentage point.

By industry, last month, employment insurance subscribers increased in manufacturing (30,000) and service sectors (191,000), while construction (-15,000) decreased. Manufacturing growth was centered on other transportation equipment, food products, and automobiles, while the service sector saw increases in health and welfare, business services, and professional sciences. Construction showed a decline for the 15th consecutive month, mainly in general construction, with the decrease expanding to the 10,000 range since June (-10,000).

Excluding the mandatory enrollment increase of foreign workers under the Employment Permit System (E9, H2), manufacturing subscribers decreased by 8,000. This decline has continued for 13 months. The number of employment insurance subscribers among foreign workers under the Employment Permit System was 246,000 as of the end of last month, an increase of 41,000 compared to the same month last year. This was due to a combination of non-enrolled foreign workers being mandatorily enrolled and an increase in the foreign workforce since last year.

By age group, subscribers increased in their 30s (53,000), 50s (101,000), and 60 and older (208,000), while those under 29 (-107,000) and in their 40s (-47,000) decreased. Those under 29 were significantly affected by population decline, showing decreases in information and communication, retail, and business facility management. Those in their 40s also showed a negative trend due to population decline, with decreases in construction, retail, and manufacturing.

Cheon Kyung-gi, Director of Future Employment Analysis Division, Ministry of Employment and Labor. Yonhap News Agency

Increase in Construction Industry Job-Seeker Benefit Applications: "Employment Situation Not Good"

Last month, new job-seeker benefit applicants numbered 89,000. Centered on construction, retail, and manufacturing industries, this was an increase of 9,900 (12.4%) compared to the same month last year, marking the highest ever for October. The number of benefit recipients reached 587,000, an increase of 21,000 (3.7%), mainly in construction and information and communication industries. The total payment amount was 1.006 trillion won, up 90.3 billion won (9.9%).

Cheon Kyung-gi, Director of Future Employment Analysis at the Ministry of Employment and Labor, explained, "The number of days for job-seeker benefit applications varies depending on when the Chuseok holiday falls. This year, since Chuseok was in mid-September, there were more days to receive applications in October." He added, "In the construction industry, applications increased significantly, especially among daily workers, with an increase of 3,365 last month. The increase across industries also tended to be larger."

Regarding the construction industry, he said, "In September, the number of employed persons decreased by 100,000, the largest decline since the 2013 industry classification revision. The employment situation in construction is poor, and daily workers are struggling to find work, so it seems many have claimed job-seeker benefits." He further noted, "Although construction orders have increased in recent months, there is a long lag before this reflects in employment, so it is difficult to see this as a positive sign immediately."

New job postings on Worknet totaled 176,000, a decrease of 62,000 (-26.0%) compared to the same month last year. New job seekers numbered 359,000, down 21,000 (-5.5%). The Worknet job-to-applicant ratio (number of jobs per job seeker) was 0.49, showing a decline for three consecutive months since August (0.54).