South Korea added a mere 5,000 new jobs in July, slowing sharply from 106,000 a month earlier, official data showed on Friday, the smallest increase since January 2010 in the depths of the global financial crisis. The latest job creation rate is far below the 72,000 reported in in May, which the South Korean finance minister said was a "shock".
July's unemployment rate was a seasonally adjusted 3.8 percent, up 0.1 percent from June. Youth unemployment remained high at 9.3 percent, unchanged from June, overshadowing President Moon Jae-in's efforts on job creation particularly for young people.
The outcome is expected to undermine the popularity of Moon, who has posed himself as a "Jobs President." His iconic income-led growth, which features less working hours and steep hike of minimum wages, is likely to draw fire as well, for hampering employment. Employment in the mining and industrial sectors was down 133,000 and manufacturing industries cut 127,000 jobs. Wholesale and retail companies, which are mostly small to medium enterprises, shed 80,000 jobs. The finance ministy said in a press release that business restructuring and meagre car sales had led to continuous job losses.
Following the release of the data, the ministry said it would employ "all available policy tools" to energise the slow job market. "First, the government will expand jobs in public sector, since tax revenue has been robust and the government has enough room to spend. Second, the administration is likely to adopt business-friendly policies to facilitate job creation," said Lee Sang-jae, chief economist at Eugene Investment and Securities.
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