COVID-19 pandemic to have negative impact on labor market for considerable period: BOK
SEOUL, The new coronavirus pandemic is expected to have negative impacts on the labor market for a considerable period as shocks in labor demand, including companies’ reduction of employment, could prolong, a central bank report showed Monday.
The COVID-19 pandemic has dealt a blow to South Korea’s labor market, in particular, face-to-face service providers, including food, accommodations and education, according to the report by the Bank of Korea (BOK).
In March and April, demand for labor declined as companies reduced their recruits and the number of involuntary unemployed people rose. Also the labor supply shrank as a large number of jobseekers gave up finding jobs, becoming non-economically active people.
The report said compared with the past, shocks in labor demand sharply increased amid the COVID-19 pandemic and that the impact of shocks in labor demand tends to be larger and longer than those of shocks in labor supply.
“This indicates that negative impacts of the virus outbreak on the labor market are likely to persist for a considerable period of time,” the report said.
South Korea lost about 277,000 jobs in July, marking a decline in the number of the employed for a fifth consecutive month, as the virus outbreak strained business activities, government data showed.
The BOK revised down its outlook for job growth this year last week.
The number of the employed is expected to decline by 130,000 this year, a turnaround from the bank’s estimate in May of an increase of 30,000. But in 2021, the tally is expected to increase by 200,000.
Source: Yonhap News Agency