South Korea Jobless Rate at Seventeen-Year-High

South Korea›s jobless rate has risen to the highest level seen in 17 years for the month of March. Analysts say the decrease in employment is mainly due to the minimum wage hike introduced earlier this year.

According to data by Statistics Korea on Wednesday, the number of unemployed people in South Korea hit 1.25 million last month. That›s up 120,000 from the same period last year, KBS World Radio News reported.

The statistics agency said the number of people without jobs topped the one million mark for the third consecutive month. As a result, the jobless rate reached 4.5% in March, the highest rate for the month since 2001 when it hit 5.1%. In particular, the unemployment rate for young people, aged between 15 and 29, came to 11.6%, the highest March figure since 2016.  

What›s more, the statistics agency found the number of people who were employed grew by only 112,000 year-on-year in March to stand at 26.6 million. It marked the second consecutive month for such growth to remain in the 100,000 range.

Observers say the sluggish growth is likely due to the 16.4% hike in minimum wage introduced in the wake of the New Year, as employers feel the pinch of extra labor costs for part-time workers. The wage floor increased to 7,530 won ($5.36) per hour, an increase of 16.4% or the biggest annual increase seen in 17 years.

Wholesale and retail businesses, as well as the food and accommodation sectors, have seen a substantial decrease in the number of people with jobs, most of which pay by the hour.

Statistics Korea maintains that the waning growth in the number of employed people is due to difficulties in the construction sector and an overall decline in the population.