A '40,000 Dollar' Era Driven by Semiconductor Boom? Why the Public Doesn't Feel It

[Anchor]

Thanks to a boom in the semiconductor industry, South Korea saw significant growth in both production and income in the first quarter of this year. While there are expectations that per capita national income could reach $40,000 this year, there appears to be a gap between these economic indicators and the reality felt by the public.

Reporter Lee Tae-kwon has the story.

[Reporter]

Last year, South Korea's per capita Gross National Income (GNI) stood at $36,900.

Per capita GNI, which is the total income earned by citizens domestically and abroad divided by the population, has remained in the $30,000 range for 12 years.

Although Korea surpassed Japan and Taiwan in 2023 and 2024, it was overtaken by them again last year.

Let's look at the situation in the first quarter to see if things will be different this year.

Real Gross Domestic Product (GDP), which measures the increase in production, rose by 1.8% from the previous quarter and 3.8% compared to the same period last year.

Real GNI, which represents the actual income earned by the public, increased by 13.2% from a year ago, significantly outpacing the growth rate of GDP.

This means that income has grown much more than production.

In particular, when looking at nominal figures that include changes in inflation and prices, production and income rose by 17% compared to the same period last year.

This exceptional growth occurred because the prices of semiconductors, a major export item, rose sharply, allowing the country to earn more money even while selling the same quantity.

So, who received this increased income?

A closer look at the increased income shows that the corporate share grew by 29.9% compared to last year, while the share for workers increased by only 6.9%.

While the nation's total income has increased, the improvement in household income remains relatively limited.

As the semiconductor boom ensures additional tax revenue, experts point out the need for policy considerations to prevent polarization and induce a trickle-down effect.

[Interview: Heo Jun-young / Professor of Economics at Sogang University: The number of people who feel that their lives have improved immediately may not be as large as expected. There is a need for a fiscal policy approach that specifically targets those suffering severely from high inflation.]

The Bank of Korea stated that per capita GNI could approach $40,000 this year, noting that it will depend on corporate performance and the won-dollar exchange rate.

(Video Editing: Jung Yong-hwa, Design: Lim Chan-hyuk)
※ Please note: This article was translated by AI and may contain errors.