The Korean Economy One Year After the COVID-19 Outbreak

Duyong Kang (), Seong-hwan Min () and Sung Keun Park ()
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Duyong Kang: Koea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr
Seong-hwan Min: Koea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr
Sung Keun Park: Koea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr

No 21/8, i-KIET Issues and Analysis from Korea Institute for Industrial Economics and Trade

Abstract: The COVID-19 pandemic is estimated to have caused a decline of 3%p in Korea’s GDP growth and 7%p in private consumption growth, as well as the loss of 460,000 jobs. Compared to previous crises, the pandemic-induced economic slowdown was the nation’s second largest, following that suffered in the wake of the 1997–98 Asian financial crisis, with severe shocks to private consumption and employment. After bottoming out in the second quarter of 2020, however, the Korean economy has recovered, albeit at varying rates by sector, amid lingering weakness in the job market. While manufacturing’s output and exports have returned to pre-pandemic levels, employment, private consumption, and service output in 2021’s first quarter lagged behind. A year’s worth of time-series data has been collected since the pandemic’s outbreak. Using this data, this study assesses the coronavirus’s impact on the Korean economy and industries, the development of the ensuing effects over time, the impact’s pathways and distribution across sectors, and policy implications.

Keywords: COVID-19; economic crisis; business cycle; Korea; manufacturing; employment; services; disaster aid; disaster relief; macroeconomics; macroeconomic policy; consumer price index; consumption; poduction; productivity (search for similar items in EconPapers)
JEL-codes: E32 F01 F02 G20 H12 J11 J21 J23 L60 O40 O47 P17 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2021-05-10
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