Finance minister puts weird spin on job data
Strategy and Finance Minister Bahk Jae-wan is gloating over the latest employment figures and claims there has been a dramatic improvement in the economy’s ability to create jobs. The apoplectic shout you just heard is the collective disgust of millions of recent graduates and those that have left school, feared to be part of an entire generation lost to unemployment.
Statistics Korea’s report on the state of the job market Wednesday provided Bahk with just enough material to issue his latest denial of the government’s losing fight against unemployment.
The official unemployment rate was measured at 3.1 percent in May, down from 3.5 percent in April and 3.2 percent in the same month a year earlier. More than 472,000 jobs were created last month, up from 455,000 positions added to payrolls in April.
This marked the eighth-consecutive month when more than 400,000 jobs were created, a streak the economy last matched in 2002.
``There are now 25 million Koreans with jobs, two years after we passed the 24 million mark. Considering that it took 61 months to go from 23 million to 24 million, it’s encouraging that the country’s ability to create jobs has improved significantly over the past two years,’’ Bahk beamed during a meeting with senior economic policymakers.
The problem is that Korean job statistics stopped making sense a long time ago, the worst example of this came in 2009 when the country’s employment and unemployment figures declined simultaneously.
The official employment rate is hardly a meaningful indicator when around 15.6 million of Korea’s 41.5 million people above the age of 15 are deemed as ``economically inactive’’ as they are neither working nor looking for work. Add to this the 800,000 listed officially as unemployed and more than half of people above the age of 15 who are sidelined from the workforce.
Government officials have long been suspected of artificially inflating the economic inactive category to hide the true jobless rate, as they count not only the students, unpaid caregivers and early retirees, but also first-time jobseekers and those preparing to take state exams.
The economically inactive population has bloated in recent years because of the increasing number of people shaved off payrolls and those forced into self-employment. The country’s increasing problem of post-retirement poverty shows that many of these shop owners are struggling to make ends meet.
And a staggering 96 percent of the new jobs created in May went to people in their 40s, 50s and 60s, confirming that the employment totals were padded by low-paid casual jobs.
Young people continue to bear the brunt of the downturn. The number of employed workers in their 20s and 30s continued to decline, largely because of slowing activity in the manufacturing sector. The unemployment rate for people between 15 and 29 was measured at 8 percent.
It’s understandable that Bahk would pounce on any glimmer of hope for an economy that faces a disastrous vortex of faltering growth, spiraling household debt and unemployment. However, combating the situation will require political honesty first and foremost. It’s regrettable that Korea’s top economic policymaker prefers performing as a master of statistical spin.