Increase in Service Sector Employment Driven by Consumer Coupons
Construction Downturn Eases, Boost from Holiday Season
Youth Employment Rate Falls 0.7 Percentage Points to 45.1%
Policy Effects Likely to Continue Through This Year
Last month, the number of people employed increased by over 300,000 for the first time in 19 months. This was primarily due to a rise in employment in domestic demand-related service sectors such as wholesale and retail, and accommodation and food services, influenced by the distribution of livelihood recovery consumption coupons. The employment rate also surpassed 70%, marking the highest level since statistics began to be compiled. However, the employment rate among young people remained around 45% and continued to decline for the 17th consecutive month.
Job seekers visiting the 2025 Mid-sized Companies Job Fair held at COEX in Gangnam-gu, Seoul on the 23rd are looking at the job posting board. 2025.4.23 Photo by Cho Yongjun
According to the "September 2025 Employment Trends" released by the National Data Agency on October 17, the number of employed people last month was 29,154,000, an increase of 312,000 compared to the same month last year. This is the first time since February of last year (329,000) that the increase in employment has exceeded 300,000 in 19 months. Except for May (245,000), the number of employed people had been increasing by around 100,000 each month until last month (166,000).
An official from the Data Agency explained, "The number of people employed in the health and social welfare services sector has steadily increased by over 300,000 for two consecutive months, and there has also been an increase in employment in arts, sports, and leisure-related services. In addition, the decline in construction employment has eased, all of which have contributed to the overall increase." The official added, "Employment in business facilities, wholesale and retail, and accommodation and food services has turned to growth, influenced by the (livelihood recovery) consumption coupons." The government also evaluated that improved consumer sentiment and the special demand ahead of the Chuseok holiday (early October) played a role.
Employment in the health and social welfare services sector increased by 304,000. The arts, sports, and leisure-related services sector saw an increase of 75,000. Business facilities (19,000) had been declining since December 2023 (-14,000) but turned to growth for the first time in 22 months. In the domestic demand service sector, wholesale and retail (28,000) was boosted by increases in wholesale and auto parts, while accommodation and food services (26,000) was positively affected by a turnaround in food and beverage services.
Although manufacturing and construction continued to decline, the rate of decrease slowed. Employment in manufacturing fell by 61,000, maintaining a decrease of over 60,000 for the second consecutive month since August (-61,000). Construction (-84,000) saw the smallest decrease so far this year. This was attributed to both the base effect from last year and improvements in leading indicators such as construction orders. Employment in agriculture, forestry, and fisheries decreased by 146,000, marking a decline of over 100,000 for the sixth consecutive month. This is the largest drop since November 2015 (-172,000).
By age group, employment increased among those aged 60 and above (381,000) and those in their 30s (133,000), reflecting demographic changes. For people in their 30s, this was the largest increase since July 2000 (141,000). In contrast, employment decreased among people in their 20s (-134,000), 40s (-45,000), and 50s (-11,000).
The employment rate indicators showed a positive trend. The employment rate for those aged 15-64, the standard used for comparison by the Organisation for Economic Co-operation and Development (OECD), was 70.4%, up 0.5 percentage points. This is the highest September figure since statistics began in 1989. The labor force participation rate (65.0%) also rose by 0.4 percentage points, setting a new September record. The unemployment rate (2.1%) was the lowest ever recorded for September.
The situation was less favorable for young people (ages 15-29). The youth employment rate fell by 0.7 percentage points to 45.1%, marking a decline for the 17th consecutive month. The gap between the employment rate for those aged 15-64 and the youth employment rate was 25.3 percentage points. An official from the Ministry of Economy and Finance stated, "Although the decrease was smaller than the previous month (-1.6 percentage points), the improvement in employment in arts, sports, and leisure-related services, as well as wholesale and retail, and accommodation and food services, has helped ease the slump among young people."
The economically inactive population, excluding the employed and unemployed, was 16,009,000, a decrease of 116,000. Among them, the number of people who reported "resting" was 2,521,000, an increase of 42,000. Focusing only on young people who reported "resting," the number was 409,000, a decrease of 34,000. The number of young people resting has been declining for five consecutive months. The proportion of young people resting compared to the total youth population decreased from 5.5% in September last year to 5.2% last month.
The government plans to continue efforts to stimulate domestic demand and manage external risks to maintain a virtuous cycle of economic recovery and job creation. The policy effects are expected to continue throughout this year. An official from the Ministry of Economy and Finance explained, "The second round of livelihood recovery consumption coupons has been distributed since September, and cultural coupons will be provided until the end of the year. A large-scale joint discount festival is also scheduled for the end of this month." However, the government also forecasted that, given the special demand effect from last month's holiday, the increase in employment may be adjusted starting this month.
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