Economic Misery Index Goes Up

The economic misery index, an indicator that measures people’s economic hardship in daily lives, surged in the 4th quarter of last year, according to a study released by the LG Economic Research Institute.

The jump is mainly due to the increase in prices of daily necessities and the worsening employment conditions. By region, Seoul, Gwangju, and Daejeon saw their citizens suffer the most.

The institute said Sunday that the nation’s economic misery index jumped to 9.9 in October from 8.5 in September, and soared to 11.0 in December last year .

The steep rise is primarily attributable to a jump in inflation. The consumer price index, which had stood at under 3.5 percent in the first half of last year, skyrocketed to 5 percent at the end of the year on the back of rising oil and grain prices.

The public’s economic hardship is also evidenced by the Bank of Korea’s announcement of consumer prices for January, which rose by 3.9 percent, the highest since September in 2004 (3.9 percent).

An alternative unemployment rate, which includes employees working less than 17 hours a week, stood at 6.5 percent in 2007, recording a slight drop from the previous year(6.7 percent). However, because the drop resulted from a decline in the official unemployment rate from 3.5 percent to 3.2, the institute explained that labor market prospects still remain negative.

Among 16 cities and provinces nationwide, Seoul had the highest misery index with 11.0, followed by Gwangju at 10.8 and Daejeon at 10.5. In the meantime, South Jeolla, North Gyeongsang, Jeju, and Gangwon provinces recorded relatively low indices with 7.6, 7.8, 8.6 and 8.7, respectively.

changkim@donga.com