Unemployment benefit payments reach new high for 3rd-straight month over coronavirus

All News 15:46 May 11, 2020

SEOUL, May 11 (Yonhap) -- The amount of state funds paid out as unemployment benefits soared to nearly 1 trillion won (US$820 million) last month, data showed Monday, due largely to the negative economic impact of the new coronavirus outbreak.

According to the Ministry of Employment and Labor, the government paid 993.3 billion won in benefits to those struggling to find jobs in April, marking a 34.6-percent increase from 738.2 billion won paid in the same month last year.

Amid a slowdown due to the outbreak, April marked the third-consecutive month for the unemployment allowances figures in reaching new record highs. Figures for February and March stood at 781.9 billion and 898.2 billion won, respectively.

The job seekers' allowances paid from employment insurance funds include early reemployment incentive allowances and unemployment benefits. Self-employed people, workers in special employment and freelancers, who are not covered by the employment insurance, are not eligible for the unemployment allowances.

The ministry said about 129,000 people applied for job seekers' allowances last month, up 33.0 percent from a year ago, suggesting that most of them appear to have been affected by the spread of COVID-19.

The ministry attributed the record payments to an increase in new applications as well as rise in both amount in payments and an extension in the period under which benefits are offered.

Among the applicants, 651,000 received an average of 1.52 million won. The number of recipients climbed 131,000 on-year, marking a record 25.2-percent increase from last year.

The growth rate of new employment insurance subscribers dropped significantly compared to March. The number of new subscribers for April reached 163,000, recording a meager 1.2 percent on-year increase. The figure for new employment insurance subscribers reached 253,000 the previous month.

New subscribers in the service sector for the month reached 9,382,000, up 2.1 percent, or 192,000, from last year. This is comparable to the 400,000-and-above monthly hikes the sector recorded in the second half of 2019. New subscribers in the manufacturing sector dropped 1.1 percent to 3,541,000, falling for eight-consecutive months since September of last year.