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"Living Standards Got Worse"

Posted March. 24, 2004 22:39,   


In the first quarter (January-March) of this year, Korean consumers felt that their living standards became worse compared to the fourth quarter (October-December) of 2003. Furthermore, an increasing number of consumers are pessimistic in forecasting their living status, assuming that it will worsen in the coming days.

Expectations of youth employment were reported to be at the lowest level since the first quarter of 2001.

According to the “consumer survey index” for which the Bank of Korea (BOK) surveyed 2,500 households in 30 cities nationwide, the first quarter’s consumer satisfaction index (CSI), indicating actual living standards of households, dropped from 75 in the fourth quarter of last year to 73, a two point drop.

In general, a CSI index less than 100 implies that consumers who believe their living standards will become worse outnumber those who believe the opposite. If the point exceeds 100, the sign is interpreted to the contrary.

However, the CSI index for living conditions for the next six months also recorded 84, which was one point lower than the previous quarter. The result revealed that people are concerned that their lives will be hard in the future.

The CSI index forecasting household incomes over the next year remained unchanged at 95 points.

Hopes of young job seekers to find jobs have also faded. The index of youth employment less than 30 for the next six months turned out to stay at the lowest level since the first quarter of 2001 (58), marking 65 points from 68 in the previous quarter.

Meanwhile, the portion of households planning to buy real estate within the next six months increased from six percent last quarter to seven percent. Among the items on their wish lists, demand for apartments declined from 61 percent to 56 percent whereas that for land increased from nine percent to 15 percent, showing high interest in land investment.

BOK official for statistical research Shin Chang-shik explained, “Korean consumers are worried about their living conditions in the future, as they expect more consumption, whereas income appears to remain the same.

Joong-Hyun Park sanjuck@donga.com