How Are We Doing? Well-Being in Korea – Do the Numbers add up?

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Gugak Center
Professor Sean O’Malley takes a look at the state of well-being in Korea and wonders, do the stated numbers really add up?

The morning began with a notion, ended in confusion and left me wanting more. I confess that I am one of those people who believe the capitalist economic paradigm currently ruling the world is on the way out. I think the confluence of technology, advanced education, greater social awareness and the trampling of the lower and middle classes by predatory capitalists, is leading to adjustments in our economic system, one that has had a surprisingly swift and effective run.

I read economists like Jeremy Rifkin and Thomas Piketty, and I wonder how society will adjust labor and employment to cope with permanent, increasing unemployment numbers under an outdated forty-hour work week mentality. In short, I enjoy researching and contemplating an exciting future of economic transition to which governments and society must adapt. Luckily, I am not the only one pondering the possibilities.

The particular morning referenced above actually began about two weeks ago. On a quest for stimulating research topics, I stumbled across the Social Progress Index; it was love at first sight, or at least, heightened curiosity at the potential relationship that lay ahead. As I watched a video introduction on TED, I wondered how it might be used to measure social progress here in Busan. You see, the Social Progress Index is one of many indices to measure well-being that “go beyond GDP”. This little catchphrase is used to describe a measurement of human well-being that goes beyond simple macroeconomic data to evaluate social progress, health or satisfaction.

Busan marine city
Busan’s Marine City (source)

Some of the more recognizable names in this category are the Human Development Index (HDI) by the UNDP, the Better Life Index by the OECD, the Sustainable Society Index (SSI) by the Sustainable Society Foundation and the Happy Planet Index. The Social Progress Index prides itself on using no economic data to formulate well-being, an interesting and admirable approach.

Yet, after seeing the components of tolerance, health, personal safety and access to advanced education, I could not escape the feeling that one economic indicator was indeed necessary to the equation:  employment, and more specifically, employment quality. After all, tolerance of immigrants may depend on one’s employment status; likewise, personal safety may be linked to job security. Similar connections arose in my mind for health and access to education. So, having finally found a few hours to call my own, I sat in front of the computer and began some rudimentary research.

I wondered how it might be used to measure social progress here in Busan. You see, the Social Progress Index is one of many indices to measure well-being that “go beyond GDP”. This little catchphrase is used to describe a measurement of human well-being that goes beyond simple macroeconomic data to evaluate social progress, health or satisfaction.

Almost immediately, I was rewarded with the OECD’s Regional Well-Being Index. Although the index does not reference Busan directly, it does measure the well-being of seven regions in South Korea, including the Gyeongnam region.  The index is a mix of both economic and non-economic components, as indicated in the chart below, and it compares the region to other regions within Korea, as well as to other countries and regions within the OECD. What struck me right away was the use of single indicators in all but two components, and how these indicators lacked an element of quality. For instance, completing secondary education does not mean one has had a quality education, nor does 1.4 rooms/person indicate a home filled with well-being.

But the element that really caught my eye was a regional unemployment rate of 2.8 percent. Being a university professor here in Busan, I was highly skeptical of this number, and this is where my morning devolved into a seemingly irresolvable, enigmatic statistical ruse.

We here in Busan are lucky enough to be surrounded by the Gyeongnam region, where civic engagement, health and access to broadband services are ranked in the top fifty percent in the OECD; education almost makes that threshold as well, which is not bad considering the OECD is made up of the world’s most advanced economies. Nevertheless, I simply could not believe that this part of Korea is in the top twenty-seven percent in jobs. After all, I had read last year in the Joongang Ilbo that the jobless rate in Korea was really ten percent, well above the official statistics of the Korean government.

That article claimed that Statistics Korea began using new, tougher standards from the International Labor Organization (ILO) to measure employment. This caused unemployment figures to rise from 3.2 percent to 10.1 percent overnight. Couple this with the fact that Gyeongnam is ranked as the fifth worst of seven regions here in Korea in “jobs”, such a discrepancy in unemployment figures made me question the definition of employment from Statistics Korea.

According to the agency, an employed person is

– A person who did at least one hour’s work during the reference week as a paid employee, worked in their own business, profession, or on their own farm, or worked 18 hours or more as an unpaid worker in an establishment or farm operated by a member of the family.

– Also includes those who were not working but have jobs or establishments from which they were temporarily absent because of illness, bad weather, vacation, leave, labor-management dispute, etc. (Economically Active Population Survey)

This definition actually corresponds closely to the “Resolution concerning statistics of the economically active population, employment, unemployment and underemployment, adopted by the Thirteenth International Conference of Labour Statisticians (October 1982)”. However, according to the Joongang Ilbo, Korea was using a new index that “takes into consideration the number of people who are willing to work but aren’t working. It also includes the number of part-time employees who work less than 36 hours a week.” This seems to reflect current ILO guidelines on underemployment. The article referenced the “Supportive Employment Index No.3,” which I could not find, so I was left to wonder whether well-being in Gyeongnam was reflected accurately in the index.

Both Statistics Korea and the Korean Statistical Information Office (KOSIS) reflect the same employment data for Korea as a whole as of March 2015. They report a four percent unemployment rate, but that number jumps to eleven percent for 15-19 year-olds and 10.7 percent for 20-29 year-olds. This has not changed significantly since late last year, which means the new tougher standards of the ILO have not been put to regular use by the government. “The Economically Active Population Survey in March 2015” shows an active employment population of 26,577,000, comprised of 25,501,000 employed persons and 1,076,000 unemployed persons. This represents an employment participation rate of sixty-two percent among the population fifteen years and over.

Busan South Korea
Busan, South Korea (Source)

The fact that the new ILO standards were not used is distressing, as the unemployment rate reflecting willingness to work and underemployment would do more to illuminate well-being. In addition, of employed persons, only 12,364,000 are regular employees, while temporary employees (4,968,000), daily workers (1,466,000), self-employed (5,593,000) and unpaid family workers (1,109,000) make up a total of some 13,136,000 employed persons. This means approximately fifty-two percent of employed persons have job insecurity, relative to regular employees. Don’t even get me started on the insecurity of being labeled employed with only one hour of work per week.

Not content with the well-being I was told exists, I searched on for hours in vain. I was able to find quarterly trends in the employment rate for 2014, including Busan, but I never found regional employment base numbers to better understand such trends. After awhile, I was simply left with frustration that somehow the OECD managed to get Statistics Korea to provide regional data that is not publicly accessible. As stated at the beginning, I was confused and left wanting more.

For now, perhaps it is enough to know that a number of researchers and policymakers are taking well-being seriously. No longer is GDP and macroeconomic growth enough to warrant the idea that a country is progressing. Numerous indices are available to reflect on the many varieties of progress that have already been defined, and although sometimes confusing, there is plenty of data for interested persons to create their own index of well-being. In fact, the OECD has an interactive data map for the Better Life Index that allows users to weigh the data according to their own preferences. It’s pretty cool.

So, how are we doing? I think it’s safe to say we are doing okay, but we could be doing better. Gyeongnam and Busan have a fairly healthy, educated and engaged populace with access to broadband. This means we can check the news or watch a movie on our smart phones while we wait for our yearly physical.

Even so, I am left with an uneasy feeling that many of the employed among us lack fundamental job security and their well-being may be a long way off. Let’s hope progress helps them soon, and when it does, let’s hope it is accurately reflected in the stats.

Gyeongnam Region Well-Being in Detail (and Korea’s ranking)

Busan Statistics


Sean O’Malley holds a PhD in International Area Studies. He is an associate professor in the Department of International Studies at Dongseo University. His latest piece “Can Military Normalization in Japan and Opcon Transfer in South Korea Enhance Regional Stability? A Conflict Management Framework for Rivalry Dyads” in the forthcoming edition of The Korean Journal of International Studies will be available soon at www.kjis.org. He can be reached at seanmo@gdsu.dongseo.ac.kr.

The views of the writer do not necessarily reflect those of the publisher of Haps Magazine. 

 

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