S. Korea's jobless rate falls to 11-month low in Oct.

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SEOUL, Nov. 11 (Yonhap) -- South Korea's jobless rate fell to the lowest level in
11 months in October amid growing signs the local economy is pulling out of a
steep downturn, a government report showed Wednesday.
The jobless rate stood at 3.2 percent last month, down from 3.4 percent the
previous month, according to the report by the National Statistical Office. The
figure marks the lowest level since November last year when the rate was 3.1
percent.
The number of employed people stood at 23.85 million last month, up 10,000 from a
year earlier. The on-year job growth, however, was smaller than a 71,000 advance
posted in the previous month, the report showed.
"Improved labor market conditions were mainly driven by the government's
increased fiscal spending aimed at creating work in the public sector," Jeong
In-sook, head of the NSO's employment statistics division, told reporters.
"Though the jobless rate fell to pre-crisis levels, it is still unclear whether
employment conditions have seen a full turnaround as things depend on the future
direction of the global economy."
The latest job data comes as a series of indicators are signaling that corporate
sentiment is slowly thawing and that companies are increasing production to brace
for more demand down the road.
The numbers are also a steep turnaround from setbacks in employment markets
hard-hit by the global financial crisis and global recession that started late
last year. Job losses surged to a 10-year high of 219,000 in May.
Major indicators are supporting the current upbeat mood.
According to separate government data, industrial output expanded in September
for a third straight month, while companies expanded investments and consumers
steadily opened their wallets.
The government said after assessing that the nation's economy that it is making a
"better-than-expected" recovery. The state-run think tank Korea Development
Institute echoed the view, saying the economy remains in a "recovery phase" as
exports, consumption and other indicators are rebounding fast.
According to the Bank of Korea, South Korea's gross domestic product expanded 2.9
percent in the third quarter from three months earlier, the fastest advance in
over seven years. The growth compares with a 5.1 percent plunge posted during the
last quarter of 2008 when the nation's economy struggled due to the financial
turbulence and a resulting global recession.
Despite the overall improvement in economic activity, however, the nation's
employment conditions remain a drag on the local economy as the recent increase
in job offerings was driven mostly by the government's temporary hiring in the
public sector, with the private sector unwilling to follow suit.
Vice Finance Minster Hur Kyung-wook voiced such concern, emphasizing the
importance of nurturing the domestic service sector that is deemed more able than
other sectors to create working positions under an economic slowdown.
"Despite the recent bounce back in economic activities, the private sector
remains reluctant to hire workers. We need to actively nurture the domestic
service sector which has a high job-creating capacity," he said in a local
meeting.
In line with such views, the government has said that it will keep its
expansionary macroeconomic policy until a sustainable growth is assured. The BOK
is also widely expected to freeze the benchmark interest rate at a record low of
2 percent in its Thursday meeting for a ninth straight month.
As a means of unclogging the stagnant job market, meanwhile, the finance ministry
in charge of the nation's budget and economic policy plans to provide a total of
550,000 temporary jobs in the public sector next year.
kokobj@yna.co.kr
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