SEOUL (Reuters) – South Korea’s jobless rate fell in May to a record low, official data showed on Wednesday, indicating a still robust labour market although conditions were softer in the manufacturing sector amid slowing economic growth.
The employment report provides a brighter backdrop to the country as it navigates external challenges from tighter monetary policy and weak demand in key trading partner economies.
The country’s seasonally adjusted unemployment rate dropped to 2.5% in May from 2.6% in April, the lowest since the data series began in June 1999, according to Statistics Korea.
The number of employed people rose by 351,000 from the same month a year earlier, compared with increases of 354,000 in the previous month and 1,135,000 in January 2022, the peak of the current employment growth streak that started in March 2021.
The finance ministry said the data showed jobs growth remained at a satisfactory level, given high base effects and the country’s population decline, and noted the continued recovery in the services sector and a softer decline of employment in the manufacturing sector.
By industry, health and social welfare workers increased 166,000, followed by hospitality and catering services which gained 128,000 employees. The construction and manufacturing sectors lost 66,000 and 39,000 jobs, respectively.
The job increase was led by people in their 60s and older, up by 379,000, offseting declines in other age groups.
“Employment will likely continue its robust trend going forward, led by the face-to-face services sector, but a recovery in the manufacturing sector is expected to be delayed due to weak exports and facility investments,” said Vice Finance Minister Bang Ki-sun, as he presided over a policy meeting on job creation.
The data comes as other economic indicators from exports to factory production and retail sales point to the country’s sluggish growth amid weakening demand at home and abroad on global monetary tightening.
(Reporting by Jihoon Lee; Editing by Lincoln Feast and Shri Navaratnam)
