Coronavirus Makes Income Gap Even Worse

  • By Choi Kyu-min

    May 22, 2020 12:22

    Low-income households have been hit particularly hard by the economic slump compounded by the coronavirus epidemic and made income disparity in Korea worse in the first quarter.

    Statistics Korea on Thursday said the income quintile share ratio, a key gauge of income equality, reached 5.41 in the first quarter, up 0.23 percentage points compared to a year ago.

    The ratio is calculated by dividing the income of the top 20 percent of wage earners by the bottom 20 percent's, so the higher the worse.

    The drastic hike in the minimum wage over the last two years was supposed to level out incomes, but in fact the earnings of low-income workers have been declining, partly because many small employers simply laid staff off.

    During the first quarter of 2018, the ratio soared to a record 5.95.

    During January to March period, the average income of the bottom bracket stood at W1.49 million, virtually flat compared to a year ago (US$1=W1,231). But the top bracket's income rose 6.3 percent to W11.15 million.

    The trend is expected to become even more pronounced in the second quarter when unemployment triggered by the epidemic is reflected in the figures.

    Statistics Korea said, "It's impossible to make a positive forecast for job or income growth in the lower brackets given the massive decline in temporary and menial jobs in April." 

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