Many South Koreans are finding themselves priced out of their usual holiday plans. (Image courtesy of Yonhap)
SEOUL, Jul. 1 (Korea Bizwire) – With the summer vacation season approaching, many South Koreans are finding themselves priced out of their usual holiday plans, opting instead for “staycations” or scaled-back trips due to persistent inflation and high interest rates.
Lee, a 29-year-old office worker in Seoul who asked to be identified only by their surname, had initially considered a domestic trip after balking at the cost of overseas travel, which can easily exceed 1 million won per person for airfare and accommodations.
However, they ultimately decided to stay home after realizing that even domestic vacation spots have become increasingly expensive.
“My salary hasn’t changed, but prices have gone up so much that even daily expenses are a burden,” Lee said. “The interest rate on my lease deposit loan, which I thought would decrease, has remained the same. Considering the economic situation, there’s nowhere affordable to go, so I’ve decided to save money and wait for the next vacation season.”
Lee’s situation is not unique. Many South Korean workers are postponing or abandoning their summer vacation plans altogether as the effects of high inflation and interest rates continue to squeeze household budgets.
According to Statistics Korea, while the consumer price index rose by 2.7% in May, down from 2.9% in April, the cumulative impact of prolonged inflation has left many feeling the pinch.
Sales of ready-to-eat meals like kimbap and sandwiches at E-mart, a major retailer, increased by 12% compared to the same period last year. (Image courtesy of Yonhap)
Joo, a 48-year-old parent of two school-age children, plans to spend the upcoming vacation period at home, exercising, reading books, and watching movies. With education costs for the children rising significantly, the idea of staying at a hotel for a vacation now seems like a luxury.
Joo is considering a short weekend family trip during the off-season when prices at tourist destinations are relatively lower.
The impact of inflation is being felt in daily life as well. As “lunchflation” — the rising cost of lunch — affects office workers, many are turning to more affordable options.
From January to May, sales of ready-to-eat meals like kimbap and sandwiches at E-mart, a major retailer, increased by 12% compared to the same period last year.
Lee, a 32-year-old office worker in Sejong, noted that a decent meal at popular tourist spots now costs 20,000 to 30,000 won per person. “A two-night trip for a family of four easily exceeds 1 million won,” Lee said.
“It might be better to save money now and focus on traveling to countries with lower costs, like Southeast Asia, during the winter vacation.”
Some travelers are modifying their plans to minimize expenses. An, a 28-year-old office worker, is trying to convince friends to switch to a budget airline for their planned trip to Mongolia this summer.
“The difference in round-trip airfare is over 200,000 won, which is significant considering the current cost of living,” An explained.
A recent survey by data consulting firm PMI found that 22.1% of respondents expect to spend between 200,000 and 400,000 won per person on their summer vacation this year, the most common response.
This represents a decrease from last year when the most common expected expenditure was between 400,000 and 600,000 won per person.
M. H. Lee (mhlee@koreabizwire.com)
