South Korean Employment Falls for First Time in 17 Months Amid Global Tensions

South Korea's job market contracted in May, with 40,000 fewer employed individuals compared to the previous year. This marks the first employment decrease in 17 months, signaling a worrying trend for the national economy. The decline is primarily attributed to a sharp fall in manufacturing jobs, exacerbated by ongoing global conflicts.

The manufacturing sector saw its largest drop since February 2019, shedding 140,000 jobs. This downturn, which has now persisted for 23 consecutive months, is linked to supply chain disruptions and rising raw material costs stemming from prolonged international conflicts, such as the war between Israel and Iran. Other sectors like agriculture, forestry, and fishing also experienced significant job losses.

Compounding the overall decline, youth employment continues to be a major concern. The number of employed individuals aged 15 to 29 decreased by 255,000 year-on-year. Consequently, the youth employment rate fell by 2.4 percentage points to 43.8%, the largest annual drop in over five years.

An official from the National Data Office noted that the prolonged Middle East conflict is causing supply chain issues in some industries, while sustained high oil prices are affecting various sectors. The overall employment rate for those aged 15 and above also dropped by 0.5 percentage points to 63.3%, continuing a downward trend observed in April.

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The prolonged Middle East war is causing supply chain disruptions in some industries, and sustained high oil prices are affecting various sectors.