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[2016-12] Evaluation of Recent Labor Market Conditions through Calculation of Employment Status Transition Rates

Group : Articles in Monthly Bulletin
Research Department 2016.12.30 4954


  This paper suggests how to calculate the rates of transition of employment statuses by using a few constraint formulas regarding employment status transitions, and evaluates current labor market conditions through calculations of relevant data. Korea’s employment conditions have been worsening while going through a period of jobless growth in the mid-2000s, a period of growthless jobs in the early 2010s and a recent delay in growth. With the sharp drop since 2015 in the number of persons newly employed, the vitality of the labor market has been deteriorating rapidly. In particular, the trend of improvement in employment conditions for women and older people is slowing down, and employment conditions for young people are also worsening due to the rapidly decreasing job-finding rate. In addition, as labor mobility among different employment statuses is decreasing, the labor market’s adaptability to domestic and external shocks is also weakening. Meanwhile, given that changes in the unemployment rate are being increasingly affected by the job-finding rate, the unemployment rate is likely to decline even further if the job-finding rate falls due to factors such as full-scale corporate restructuring and widening labor market mismatches.