Unemployment of college graduates hits record high

The unemployment rate for college graduates rose to a record high in the second quarter as companies and small businesses grew more reluctant to hire new workers amid a consumption slump and other unfavorable business conditions. Due to worsening job market conditions, the number of unemployed university graduates as of June exceeded the figure following the 1997-98 Asian financial crisis.

According to Statistics Korea, Wednesday, the number of unemployed college graduates reached 543,000 in the second quarter, up 2,000, or 0.3 percent, from a year ago.  This was the highest figure since the agency started collecting related data, and was also almost twice the unemployment figure for college graduates immediately after the IMF crisis where 276,000 college graduates failed to land a job in the third quarter of 1999.

The study displayed the number of the total unemployed people reached 1.1 million in the period. Of them, the number of jobless college graduates accounted for 49.1 percent. The nation’s jobless college graduates also outnumbered those of high school and middle school graduates at 447,000 and 116,000, respectively.  “Unemployed college graduates in their 20s occupy large portion of the nation’s unemployment rate,” said the Statistics Korea in the press release. “An increasing number of unemployed college graduates in their 30s is another factor behind the nation’s worst job market in the second quarter.” The Statistics Korea study also demonstrated that the situation for high school graduates wasn’t any better in the period.  The study said 10.22 million high school graduates were employed in the second quarter this year, down 283,000, or 2.7 percent, from a year ago.  The number has been on a downtrend for seven consecutive months since February, also the longest since the global financial crisis in 2007. Due to this, the number of people receiving state unemployment benefits also hit a record high.

According to the Korea Employment Information Service, 635,004 people received unemployment benefits in the second quarter this year, up by 60,505, or 10.5 percent, from 574,499 during the same period last year. The figure is the highest since the employment agency began compiling related data in 2010. Economists say the Moon Jae-in administration’s economic policies have made things worse for the labor market as tightened regulations on large business groups and minimum wage hikes have discouraged employers from hiring workers. “The government’s policies have failed to address the nation’s current economic situation. There wasn’t much room for firms to invest amid the downturn. Due to mounting pressure in labor costs, not only conglomerates but also small businesses have downsized their staff,” said Sung Tae-yoon, a professor of economics at Yonsei University.

By Jhoo Dong-chan

(Korea Times)