South Korea Says Recovery Remains Solid as Exports Surge, but Inflation, Youth Jobs Weigh

South Korea’s government said the domestic economy continues to recover on the back of rising exports and investment. It also flagged inflation pressure from high oil prices and weak youth employment as persistent burdens on households.

The Ministry of Economy and Finance said in the October edition of its Recent Economic Trends report, released on Oct. 16, that “a solid recovery is continuing, with exports posting a sharp increase, investment showing healthy growth, and consumption improving gradually.”

Exports led the recovery. September exports jumped 83.5% from a year earlier, driven by strong shipments of semiconductors, computers and cosmetics. Average daily exports, which adjust for the number of working days, rose 104.9% to $5.63 billion. Facility investment in the second quarter also increased 0.2% from the previous quarter and 6.3% from a year earlier.

The labor market showed a mixed picture across industries and age groups. The number of employed people rose by 113,000 from a year earlier to 29.266 million in September, extending gains to a third straight month. Manufacturing employment increased by 16,000, returning to growth for the first time in 27 months. By contrast, youth employment fell by 147,000, marking a 47th straight month of declines, while the employment rate for people aged 15 and older slipped 0.2 percentage point to 63.5%.

Inflation was pushed up by rising global oil prices. Consumer prices rose 2.9% in September from a year earlier, above the government’s 2% inflation target. Petroleum prices climbed 14.2% from the same month a year earlier, adding to price pressure.

The ministry said pressure on households remains, citing inflation tied to high oil prices and difficult job conditions for vulnerable groups and sectors. It added that it would strengthen policy efforts to stabilize livelihoods and ease polarization while closely managing supply and demand for key goods so that the benefits of growth spread more broadly across the economy.