South Korea’s living standards deteriorated to the worst in 17 years last year due to steep rise in food costs amid stagnant income, data showed.
According to the Bank of Korea on Tuesday, the Engel’s coefficient - the proportion of money spent on food in household expenses - hit 13.8 percent against income and spending data as of the end of September of 2017, up 0.2 percentage point on year and highest since 13.9 percent in January-September of 2000.
Korean households on average spent a total of 573.7 trillion won ($536.2 billion) from January to September last year, up 3.3 percent compared to the same period in the previous year. Out of the total household spending, 78.9 trillion won was spent on food and non-alcoholic beverages, rising 4.7 percent from a year ago.
The Engel’s coefficient named after 19th century German statistician is watched as an indicator of a nation’s standard of living. The figure tends to fall when the economy is in an uptrend and people are wealthier as they can afford to spend beyond staples.
Changing lifestyles and demographic factors also play a part in today’s data. Last year’s jump in food prices due to unseasonable weather conditions also contributed to the spike in food spending, the BOK said.
The biggest reason, however, is stagnant income. Korean monthly household income hardly grew from the third quarter of 2015 until the second quarter last year.
By Kim In-oh and Cho Jeehyun
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]