Declining Employment Insurance Subscribers and Rising Unemployment Benefits in the Construction Sector Highlight Industry Struggles

The ongoing slump in the construction sector has led to a 13-month consecutive decline in the number of employment insurance subscribers,

The ongoing slump in the construction sector has led to a 13-month consecutive decline in the number of employment insurance subscribers, while new unemployment benefit claims have surged by 23% over the past year. This blog post examines the latest statistics to analyze the employment situation in the construction industry and the trends in unemployment benefits, highlighting the current challenges faced by the sector.

1. Construction Sector Employment Insurance Subscribers Down for 13 Consecutive Months

According to the Ministry of Employment and Labor, as of the end of August, the total number of regular employment insurance subscribers was 15.45 million, an increase of 220,000 (1.4%) compared to the previous year. The service sector led this increase with 192,000 more subscribers, primarily in health and welfare, business services, professional sciences, accommodation and food services, and transportation and warehousing. The manufacturing sector also saw a rise of 38,000 subscribers, though the number decreased by 3,000 when excluding foreign workers on work permits. However, the number of employment insurance subscribers in the construction sector stood at 767,000, a decrease of 13,000 from a year ago, marking a 13-month continuous decline.

2. Significant Rise in Unemployment Benefit Claims

The downturn in the construction industry is also evident in the rise in unemployment benefit claims. As of last month, new claims for unemployment benefits in the construction sector reached 15,000, a 22.9% increase from the previous year. The number of individuals receiving unemployment benefits in the construction sector rose to 72,700, representing a 17.8% increase over the past year. This marks a significant increase compared to the 50,200 individuals receiving benefits in August 2022.

3. Comparison with Overall Industry Trends

The increase in unemployment benefit claims within the construction sector contrasts with the overall industry trends, where both new claims and the number of beneficiaries have decreased. Last month, the total number of new job-seeker benefit claims was 86,000, down by 500 (0.6%) from the previous year. The number of benefit recipients also declined by 2,000 (0.4%) to 625,000, and the total payout decreased by 22.6 billion KRW (2.2%) to 1.025 trillion KRW.

This divergence highlights the severe difficulties faced by the construction industry, emphasizing the need for additional support and policy measures to address these challenges. The data reflects the urgent need for targeted interventions to help stabilize the sector and support its workforce during this period of economic uncertainty.

The statistics on employment insurance and unemployment benefits vividly illustrate the serious issues confronting the construction sector. The persistent decline in employment insurance subscribers and the sharp increase in unemployment benefit claims underscore the current hardships faced by industry workers. These trends indicate that further support and policy adjustments will be crucial in aiding the recovery and improving conditions in the construction sector.