In the first half of this year, it was reported that 1 in 4 South Korean workers earn a monthly salary of over 4 million KRW. This increase, compared to the previous year, has set a new record for high-income workers. However, despite this positive news, some industries, such as construction and retail, are seeing a decrease in employment due to sluggish domestic demand, revealing a growing divide in the job market.
The Era of 4 Million KRW Salaries - What’s Behind the Record?
Recent statistics show that 25.9% of South Korean workers now earn over 4 million KRW per month. As of the first half of 2024, this is the highest percentage on record, reflecting significant changes in the country’s income structure. While this seems to be a positive indicator of economic growth and the rise of high-income professions, the reality of the job market reveals a contrasting trend. Some industries are struggling with employment declines, particularly in sectors impacted by sluggish domestic demand. In this post, we will explore both the salary increases among workers and the challenges faced by certain industries.
Salary Increases and Employment Challenges by Industry
1. The Rise in High-Income Workers
According to data released by Statistics Korea for the first half of this year, 25.9% of wage earners now receive a monthly salary of over 4 million KRW. This is an increase of 1.9 percentage points compared to the previous year, marking the highest percentage since the compilation of these statistics began in 2013. While over half (52.2%) of workers still earn less than 3 million KRW, the steady rise in high-income earners highlights a shift in income distribution.
The increase in high-income workers is largely attributed to the growth of high-value industries such as IT, finance, and management. Occupations in management-related administrative positions, as well as healthcare and care services, have seen a notable rise in employment, which likely contributed to the expanded proportion of high-income workers. These changes reflect the structural shifts driven by technological advancements and an aging population.
2. Employment Decline Amid Sluggish Domestic Demand
Despite the rise in income for some, other sectors are facing a sharp decline in employment due to weak domestic demand. Industries such as construction and retail have seen a significant decrease in employment, with construction jobs down by 79,000 and retail jobs down by 18,000 compared to the previous year. This decline is largely due to the ongoing slump in the real estate market and decreased consumer spending.
Additionally, jobs in traditional sectors such as store clerks and manual labor in construction and mining are seeing the most significant employment drops. The decrease in these sectors highlights the growing gap between industries that are thriving and those that are struggling in the current economic climate.
3. Industries with Job Growth and Future Outlook
On the other hand, certain sectors are experiencing positive job growth. Employment in management-related administrative roles has increased by 91,000, while jobs in healthcare and care services have risen by 49,000. The food and beverage service industry also saw an increase of 42,000 workers. These trends are driven by societal changes such as the growing demand for healthcare services in an aging population and the continued growth of the food service industry.
Looking ahead, the job market will likely continue to evolve, with a growing emphasis on high-value and service-oriented industries. However, the challenge remains to address the job loss in sectors impacted by domestic demand declines, requiring careful attention from both the private and public sectors.
The Era of 4 Million KRW Salaries Comes with a Growing Job Market Divide
As seen from this year’s data, South Korea has entered an era where 1 in 4 workers earns over 4 million KRW per month. This shift reflects changes in the job market, with growth in high-income professions such as management and healthcare. However, the downturn in construction and retail industries due to sluggish domestic demand highlights the growing divide in employment opportunities across sectors. As technological advances and demographic changes continue to reshape the labor market, both individuals and companies must adapt to find new opportunities, while the government should focus on policies to bridge the gap and ensure a balanced labor market.
3 line summary for you
- In the first half of 2024, 25.9% of South Korean workers earned more than 4 million KRW, a record high.
- However, industries like construction and retail have seen a significant drop in employment due to weak domestic demand.
- Meanwhile, employment has increased in healthcare, management, and food service sectors, reflecting ongoing changes in the labor market.
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