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Policy Study
A Study on Youth Unemployment from the Perspective of Worker Flow

December 31, 2019

  • Author KIM. Jiwoon
  • Series No. Policy Study 2019-14
  • Language Korean
PDF
Policy Study
A Study on Youth Unemployment from the Perspective of Worker Flow

December 31, 2019

  • Author KIM. Jiwoon
  • Series No. 2019-14
  • Language Korean
PDF
This study quantified the contribution of labor market transition rates to the rise in youth unemployment in 2012-2017. Under the assumption that there was no entry into or exit from the labor force, the 2.95%p and -0.31%p increase in the youth unemployment rate in 2012-2017 (2.30%p) can be explained by the decreasing job-finding rate and increasing job-separation rate. Indeed, the downtrend in the job-separation rate during the period spurred the decrease in the unemployment rate. This means that if the job-separation rate had not fallen, the youth unemployment rate would have risen by another 0.31%p. The results of the analysis show that, assuming that there is no movement in the labor force, a falling job-finding rate serves to exacerbate youth unemployment. When the same analysis was divided into men and women, it was found that the unemployment rate rose significantly on a drop in the job-finding rate for both groups. However, the decrease in the job-separation rate for men was minimal, and as such, the increase in the youth unemployment rate was greater.

If the movements in the labor force are considered, the increase in the youth unemployment rate can be mainly attributed to the declines in the transition rate from unemployed to employed and that from ‘not in the labor force’ (NILF) to employed; the impact of the former is double that of the latter. Moreover, while the fall in both transition rates was the main driver of youth unemployment for men and women, the decrease in the transition rate from employed to NILF was greater for women than for men, which partly offset the rise in the unemployment rate on the decrease in the transition rate to employed.
 
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Office of Global Economy
Providing Economic Forecast and Macroeconomic Policy Direction, the Groundwork for a Brighter Future

The Department of Macroeconomics is conducting researches on the macro economy and macroeconomic policy, particularly focusing on suggesting the analysis of macroeconomic trends and current status of the economy at home and abroad, the economic forecast, and the policy direction of the macro economy. The Department is also in charge of establishing, sustaining and maintaining various econometric models, based on which it analyses policy effects and develops a long-term economic forecast.

Main Tasks
  • Economic trend analysis, short- and long-term forecast
  • Policy study on macroeconomic management
  • Basic structural analysis on macroeconomic areas
  • Maintenance of multi-sectoral dynamic macroeconomic model
Department of Macroeconomic Policy
  • LEE. Tae Suk

    Director, Division of Analysis and Evaluation

    82-044-550-4725
  • CHO, Byungkoo On leave

    Director and Vice President, Department of North Korean Economy

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  • LEE, Jongkyu

    Fellow

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  • WEE, Hyeseung Dispatched

    Research Associate

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  • NAM, Jinwook On leave

    Specialist

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  • KIM, Seulki

    Research Associate

    82-044-550-4725
  • CHUN, Eunkyung

    Research Associate

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