Ministry of Economy and Finance

On February 17th (Monday), Acting President and Deputy Prime Minister Choi Sang-mok, who also serves as the Minister of Economy and Finance, held a luncheon meeting at the Government Complex-Seoul with high-level officials from relevant ministries* and key policy demanders such as working moms and dads, heads of companies with excellent work-life balance practices, and family-friendly certified companies.   * The governments side attendees include Minister of Employment and Labor Kim Moon-soo, Vice Minister of Gender Equality and Family Shin Young-sook, and Vice Minister of Small and Medium-Sized Enterprises and Startups Kim Sung-sup.   The luncheon meeting was organized to encourage leaders of outstanding companies in the areas of  building a culture with work-family balance in their companies, listen to the challenges faced by employees balancing work and parenting, and share and discuss future policy directions.   Acting President Choi stated at the meeting that “in order to address the low birthrate, creating an environment in which work and family can coexist harmoniously is essential” and emphasized that “the government is shoring up financial and tax support by significantly expanding the budget for fertility policies, introducing a marriage tax credit, and increasing the child tax credit.” Furthermore, he noted that with the implementation of the ‘three laws for childcare support’[1] starting from February 23, additional childcare support, such as extension of parental leave period (one year to one and a half years) for shared parenting and of spousal paternity leave period, will be provided, with the expectation of a more widely spreading childcare-friendly culture.   Also, he highlighted that not only the government but also the role of businesses and a shift in their perception are important in enhancing work-family balance. While stating that “the government is designating companies that take the lead in work-family balance as ‘Excellent Work-Life Balance Companies’ and ‘Family-Friendly Certified Companies’, providing various incentives including tax audit deferrals and preferential treatment in government support programs.”, he encouraged more companies to join in creating work-life balance environments and spreading this culture.   Participants expressed hope that ①the changes in support systems for work-parenting balance this year would contribute to tackling the low birthrate, and stressed the need for active promotion of the benefits to beneficiaries. They also requested ②the expansion of childcare facilities for those working in SMEs as workplace childcare centers are a crucial part of achieving work-family balance. Furthermore, they suggested ③bolstering support for substitute workers filling in for those on parental leave and proposing additional benefits for ‘Excellent Work-Life Balance Companies’ and ‘Family-Friendly Certified Companies.’   In response, officials from related ministries stated that they would ①actively promote the support systems for work-parenting balance that are changing this year to ensure that no one misses out on utilizing them due to a lack of awareness; they also mentioned plans to continue ②scaling up joint workplace childcare centers for SMEs by providing installation cost support; not only that, they will ③collaborate with local governments and Shinhan Financial Group to shore up support for substitute workers*, and ④enhance cross-ministerial cooperation to prepare additional incentives for leading companies in work-family balance.   * Expansion of support for substitute workers: Ministry of Employment and Labor (up to 1.2 million KRW per month, maximum 14.4 million KRW) + Shinhan Financial Group & Korea Foundation for Cooperation of Large & Small Businesses (maximum 2 million KRW) + 5 local governments (maximum 2 million KRW).   Acting President Choi pointed out that “after the total fertility rate in 2023 hit a record low of 0.72, there have been positive signs of recovery in 2024, marking the first rebound in nine years. However, there is still much to be done to establish a culture of work-family balance.” He further underlined that “the government will incorporate the participants’ opinions shared today into the policy-making process so that we make utmost-effort for workers balancing both work and childcare can experience tangible changes.” [1] Equal Employment Opportunity and Work-Family Balance Assistance Act, Labor Standards Act, Employment Insurance Act Please refer to the attached files.

In January 2025, the employment rate for those aged 15 and above reached 61.0% (the highest for January on record), unchanged from the previous year. The employment rate for those aged 15-64 stood at 68.8% (the highest for January on record), an increase of 0.1%p from the previous year. The labor force participation rate was 63.4% (the highest for January on record), rising by 0.1%p from the previous year, while the unemployment rate remained steady at 3.7%, unchanged from the previous year.   * Employment Indicators for January (2024→2025, %):    Employment rate   61.0 → 61.0                                                                                            Labor force participation rate 63.3    → 63.4                                                                                            Unemployment rate   3.7 → 3.7   By age group, the employment rate picked up for those in their 30s (80.0%, +0.9%p), 40s (78.8%, +0.6%p), and those aged 60 and over (42.3%, +1.0%p). However, the employment rate decreased for the youth (44.8%, -1.5%p) and those in their 50s (76.5%, -0.3%p).   The number of employed persons rose by 135,000 compared to the previous year. By industry, the service industry (+177,000 → +349,000) and the agriculture, forestry and fisheries industry (+25,000 → +7,000) saw increases, while there were declines in the construction (-157,000 → -169,000) and manufacturing (-97,000 → -56,000) sectors. By employment status, the growth in regular workers expanded (+187,000 → +224,000), while temporary workers (-86,000 → +72,000) turned to an increase, and the decreases in daily workers narrowed (-150,000 → -116,000).   * Growth in the number of employed persons (year-on-year, ten thousand): (Q1, 2024) +29.4  (Q2) +14.6  (Q3) +14.6  (Q4) +5.2  (Dec) -5.2  (Jan, 2025) +13.5 In January, the number of employed persons turned to an increase after two months, with the growth in the service sector expanding, driven by direct job creation programs and increased purchases of highly demanded goods before the Lunar New Year holiday (February 2024 → January 2025). However, the employment decline in key sectors such as manufacturing and construction continues, and the difficulties faced by vulnerable groups, including the youth, persist. Meanwhile, the decline in working-age population is expected to start limiting job growth from 2025, and there are significant uncertainties ahead, including risks of economic downturn.   The government plans to accelerate efforts to create jobs in the private sector and ensure employment stability for vulnerable groups in order to build momentum for the recovery of people’s livelihoods. In the first quarter, the construction sector will be strengthened through the quick execution of the budget for Social Overhead Capital (SOC) and public institution investments, while also enhancing tailored employment services for vulnerable groups such as youth and middle-aged workers. For young people, the Youth Employment All-Care Platform will be fully operational starting in March, and a joint public-private job fair will be held to foster and spread a positive atmosphere for the youth employment. In addition, the government will continuously devise and monitor support measures for vulnerable sectors through the Job Creation Task Force and Meeting on Improving People’s Livelihoods.   Please refer to the attached files.   

In December 2024, industrial and services production, and facilities and construction investments climbed up while retail sales dropped.   Production increased in the industrial (+4.6% m-o-m, +5.3% y-o-y), services (+1.7% m-o-m, +1.2% y-o-y), and construction (+1.3% m-o-m, -8.3% y-o-y) sectors, leading to growth in the entire industrial production (+2.3% m-o-m, +1.4% y-o-y)   Facilities investment (+9.9% m-o-m, +13.1% y-o-y) and construction investment went up (+1.3% m-o-m, -8.3% y-o-y) while retail sales went down (-0.6% m-o-m, -3.3% y-o-y).   Exports in January 2025 fell by 10.3% year-on-year, due to the reduced number of working days. Average daily exports surged by 7.7% in January compared to the same month of last year.   The consumer sentiment index (CSI) in January rose by 3.0 points month-on-month to 91.2. Although the composite business sentiment index (CBSI) moved down by 1.4 points to 85.9, the CBSI outlook for February moved up by 2.5 points to 85.4.   The cyclical indicator of the coincident composite index for December remained unchanged, while the cyclical indicator of the leading composite index decreased by 0.2 points.   In January, the number of employed persons has shifted to an upward trend, while consumer price growth rose at a faster pace.   The number of employed persons grew by 135,000 compared to the same month last year, and the unemployment rate remained unchanged at 3.7% from a year ago.   The year-on-year consumer price index (CPI) climbed to 2.2% while the CPI excluding the food and energy sectors grew by 1.9%.   In January, stock prices surged, Korean Treasury Bond yields fell and the Korean won strengthened.   In December, housing prices declined (-0.07%, m-o-m), while the growth in Jeonse[1] prices rose at a slower pace (+0.01%, m-o-m).   Recently, the Korean economy has faced delayed recovery in domestic demand, such as consumption and construction investment, along with sustained challenges in employment particularly in vulnerable sectors. Moreover, economic sentiment has weakened due to escalating domestic and external uncertainties, leading to heightened downward pressure on the economy.   Amid ongoing geopolitical risks, the global economy is facing increased uncertainties in trade, including the potential imposition of tariffs by major countries.   Based on the livelihood and economic response plan for the first quarter, all available means will be mobilized to swiftly prepare and implement improvement measures for each area including employment, public finance, and small businesses. Furthermore, the government will proactively respond to trade environment uncertainties, including supporting domestic companies that may be affected by the imposition of U.S. tariffs and establishing a fund for advanced strategic industries. [1] lump-sum deposits with no monthly payments Key Statistics Employment   2023 2024       2025 Annual Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Number of employed  (million) 28.42 27.74 28.04 28.40 28.69 28.91 28.91 28.86 28.80   28.84 28.85 28.82 28.04 27.88 Employment  rate  (%) 62.6 61.0 61.6 62.4 63.0 63.5 63.5 63.3 63.2    63.3 63.3 63.2 61.4 61.0 (Seasonally adjusted)   62.6  62.8  63.0 62.8 62.9 62.6 62.6 62.6 62.7    62.8 62.7 62.7 62.3 62.9 Consumer Price Index                                                                                          (%)   2023 2024  2025 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan y-o-y  3.7 3.8  3.3   3.2  2.8 3.1 3.1 2.9 2.7 2.4 2.6 2.0 1.6 1.3 1.5 1.9 2.2 m-o-m  0.5 0.4  -0.5   0.0 0.4 0.5 0.1 0.0 0.1 -0.2 0.3 0.4 0.1 0.0 -0.3 0.4 0.7   Retail Sales (Percentage change from the previous period, %)   2022 2023   2024 Annual Q1 Q2 Q3 Q4 Annual Q1 Q2 Q3 Q4 Annual Q1 Q2 Q3  Q4¹   Nov¹ Dec¹ Retail sales -0.3 -0.9 -0.7 0.8 -1.5 -1.5 0.6 -0.5 -1.9 0.4 -2.2 -0.5 -0.8 -0.6 -0.6  0.0 -0.6 (y-o-y) - 2.6 -0.2 -0.9 -2.3 - -0.8 -0.7 -2.7 -1.9 - -2.1 -2.9 -1.9  -2.1 -2.2 -3.3 1. Preliminary Facility Investment Index (Percentage change from the previous period, %)   2022 2023                                    2024 Annual Q1 Q2 Q3 Q4 Annual Q1 Q2   Q3 Q4 Annual Q1 Q2 Q3 Q4¹   Dec¹ Facility investment index 2.5 1.8 -2.2 9.8 -1.6 -4.9 -8.6 1.5 -1.9 5.0 4.1 -3.8 -0.2 10.3 0.1 9.9 (y-o-y) - -0.7 -3.6 5.6 9.1 - -1.9 -1.3 -9.9 -6.0 - 0.3 -1.5 10.7 7.0 13.1 1. Preliminary    Construction Completed  (Percentage change from the previous period, %)   2022 2023                                    2024 Annual Q1 Q2 Q3 Q4    Annual Q1 Q2 Q3 Q4    Annual   Q1 Q2 Q3 Q4¹  Dec¹ Construction Completed (Constant) 2.8 -1.5 1.5 1.5 4.3 7.3 2.8 1.1 1.1 -2.5 -4.9 4.9 -6.2 -5.0 -5.2 1.3 (y-o-y) 2.7 -1.7 2.0 3.6 6.7 - 11.5 8.7 10.1 0.6 - 4.1 -3.0 -9.6 -10.1 -8.3 1. Preliminary Exports and Imports  (US$ billion, y-o-y, %)   2023 2024 2025 Annual Q1 Q2 Q3        Q4 Annual       Q1 Q2       Q3 Q4 Jan      Jan Exports 632.23 151.22 155.78 157.10 168.12 683.69 163.34 54.73 171.51 173.66 175.18 49.12 (y-o-y, %) -7.5 -12.8 -12.0 -9.7 5.7 8.1 8.0 18.1 10.1 10.5 4.2 -10.3 Average daily exports 2.34 2.24 2.33 2.29 2.49 2.53 2.44 2.28 2.58 2.54 2.56 2.46 Imports 642.59 174.04 159.25 150.72 158.56 632.10 155.10 54.47 156.97 160.02 159.93 51.00 (y-o-y, %) -12.1 -2.2 -13.2 -21.6 -10.7 -1.6 -10.9 -7.7 -1.4 6.2 0.9 -6.4 Average daily imports 2.38 2.58 2.38 2.20 2.35 2.34 2.31 2.27 2.36 2.34 2.33 2.55 Industrial Production (Mining, Manufacturing, Electricity and Gas Production)                 (Percentage change from the previous period, %) 2022 2023  2024 Annual Annual   Q1 Q2 Q3 Q4 Annual¹ Q1 Q2 Q3 Q4¹ Nov¹ Dec¹ Total Production2 m-o-m, q-o-q - - 0.4 2.6 1.3 2.2 - -0.3 1.1 -1.0 2.3 -0.3 4.6 y-o-y 1.0 -2.6 -8.3 -6.1 -0.4 4.8 4.1 5.9 4.8 2.4 3.7 0.1 5.3 Manufacturing Production m-o-m, q-o-q - - 0.3 3.0 1.3 2.2 - -0.5 1.5 -1.3 2.6 -0.2 4.4 y-o-y 0.9 -2.6 -8.7 -6.2 -0.2 5.1 4.4 6.2 5.0 2.3 4.1 0.4 5.5 Shipments (m-o-m, q-o-q) 0.3 -0.5 0.1 2.6 -0.8 2.0 0.5 -3.0 1.5 -1.1 0.7 -0.2 8.2 Inventory3 (m-o-m, q-o-q) 4.1 -2.1 3.4 -0.8 2.4 -6.6 -2.0 1.0 -2.4 2.0 -2.1 -0.4 -3.6 Production capacity (y-o-y) -0.5 0.1 -0.9 -0.8 0.0 2.1 0.9 1.6 1.1 0.4 0.8 0.8 0.7 Average operation ratio4 74.5 71.9 70.6 72.0 72.3 72.5 72.9 72.7 73.5 72.9 72.3 71.6 73.5   1. Preliminary   2. Mining, Manufacturing, Electricity and Gas Production   3. End-point (month, quarter, and year)   4. Average operation ratio for the month (or quarter)    Service Output            (Percentage change from the previous period, %)   2022 2023                             2024 Annual Q1 Q2 Q3 Q4 Annual Q1 Q2 Q3 Q4  Annual  Q1 Q2 Q3 Q4¹ Nov¹  Dec¹ Service output 7.0 0.6 3.3 1.6 0.3 3.1 1.0 0.0 1.0 0.3 1.4  0.8 -0.3   0.2   0.4 -0.2 1.7     1. Preliminary Composite Indices of Coincident and Leading Indicators                                                                                            (Points)    2024 Jan Feb Mar Apr May Jun Jul Aug Sep  Oct¹ Nov¹ Dec¹ Cyclical indicator of coincident composite index 99.9 100.1 99.8 99.7 99.1 99.0 98.3 98.2 98.1 98.1 97.6 97.6 m-o-m (points) 0.1 0.2 -0.3 -0.1 -0.6 -0.1 -0.7 -0.1 -0.1 0.0 -0.5 0.0 Cyclical indicator of leading composite index 100.2 100.4 100.2 100.5 100.5 100.7 100.7 100.6 100.7 100.6 100.8 100.6 m-o-m (points) 0.0 0.2 -0.2 0.3 0.0 0.2 0.0 -0.1 0.1 -0.1 0.2 -0.2 1. Preliminary   Please refer to the attached files.