Analysts expect job market to remain cloudy



By Park Hyong-ki





The nation's unemployment rate hit a 13-year high in October, further overshadowing prospects for the economy.



The number is particularly disappointing as it comes a month after the government unveiled a set of measures to create more jobs by using a massive amount of taxpayers' money



According to Statistics Korea, Wednesday, the number of jobs created in October stood at 64,000 year-on-year, under the desired threshold of 100,000 per month for four consecutive months.



With fewer jobs not only for the young but also for those in their 40s and 50s, unemployment has risen to its highest in 13 years, at 3.5 percent.



This in turn has pushed down the employment rate by 0.2 percentage points to 61.2 percent, sliding for ninth straight month ― the worst since the aftermath of the global financial crisis in 2008.



As in September, the statistics agency continued to point out that the market was in "bad shape," backing Finance Minister Kim Dong-yeon, who recently told lawmakers that he does not expect an immediate rebound even with state-owned enterprises' short-term hiring plans.



Bin Hyun-joon, a director at Statistics Korea, also said the job market remained idle and sluggish as there weren't any "special events" that could have helped create jobs for the young over the past month.



"Overall, the situation still does not look good," Bin told the press, pointing to a drop in the number of jobs for 40- and 50-somethings.



The job rate for the 40s group dropped 0.7 percentage points to 79 percent, while that for those in their 50s fell 0.6 percentage points to 75.5 percent.



Prolonged weak job data is expected to push finance minister nominee Hong Nam-ki, who will be replacing Kim, to promptly come up with new measures as he said he took the matter very seriously.



However, analysts questioned whether another short-term fiscal contribution will help improve the situation.



The job market will continue to suffer amid ongoing corporate restructuring in industries that used to drive growth such as shipbuilding and automobiles, and decreasing productivity. Those in their 40s and 50s have mostly been let go amid the industrial downturn.



"Also, uncertainty stemming from the trade dispute between the United States and China has made companies cautious toward investing," said Moon Jeong-hee, an economist at at KB Securities.



The analyst added a decrease in the number of construction projects will further affect the job market.



Thus, the number of new jobs is expected to remain below 100,000 for the rest of the year, analysts said.



Last year, the average number of jobs created per month was 300,000.



Choi Kyung-soo, a senior researcher at the Korea Development Institute, said the job market is likely to face "unwanted side effects" if the pace of the minimum wage hike remains the same.



