Health care services saw a 6.4 percent average annual rise, reflecting South Korea’s aging population and lengthening life expectancies which have stoked demand for medical treatment. (Image courtesy of Yonhap)
SEOUL, Apr. 8 (Korea Bizwire) – As South Korea’s economy continues its transition toward a service-based model, a handful of industries like finance, health care and real estate have emerged as consistent drivers of expansion over the past decade, government data has revealed.
Statistics Korea reported on April 5 that the nation’s service sector output increased by an average of 2.6 percent annually from 2014 through 2023, with growth rates only dipping into negative territory in 2020 amid the initial Covid-19 outbreak.
However, a closer look at the 37 service industries classified by the government reveals a stark divide in performance. Just five areas — finance, health care, social services, real estate and rental services — managed to post production gains every single year over the 10-year span.
The finance industry led the pack with an average annual output increase of 6.6 percent, buoyed by factors like an expanding loan market and the rise of digital banking services as the overall economy grew.
Health care services saw a 6.4 percent average annual rise, reflecting South Korea’s aging population and lengthening life expectancies which have stoked demand for medical treatment.
The real estate sector, encompassing rentals, brokerage and development activities, climbed 3.5 percent per year on average. Even last year’s slump in construction failed to derail its expansion, with 2022 output up 3.2 percent.
Stripping out real estate, the rental and leasing segment still advanced 5.8 percent annually over the decade, though its relatively small market size limits its impact on overall service sector metrics.
“Finance, health care and real estate are all industries focused on domestic demand with low export contributions,” noted Kim Kwang-suk, director of economic research at the Korea Economic Research Institute. “Balanced growth across more sectors is needed for the sustainable development of Korea’s service industries.”
M. H. Lee (mhlee@koreabizwire.com)
