An analysis has emerged that the temporary holidays designated by the government under the pretext of revitalizing domestic demand and expanding citizens' right to rest do not have clear economic effects, unlike in the past.
According to a report titled 'Pros and Cons of Designating Temporary Holidays: Realities and Limitations of Revitalizing Domestic Demand and Guaranteeing Rest Rights' published by the National Assembly Research Service on the 12th, recent temporary holidays not only have limited effects on stimulating domestic demand but also reveal structural limitations such as decreased exports and production and gaps in guaranteeing the right to rest.
Temporary holidays have traditionally been designated to promote consumption and guarantee citizens' right to rest. During the temporary holiday for the 70th anniversary of liberation in 2015, sales at department stores, large discount stores, and duty-free shops increased by 6.8%, 25.6%, and 16.5%, respectively, and the number of visitors to various tourist and cultural facilities also increased significantly, showing clear effects of domestic demand stimulation.
However, the effectiveness of recent temporary holidays has not been as good as before. On January 27 of this year, a temporary holiday coincided with the Lunar New Year holiday, creating a long six-day holiday. However, as the number of citizens traveling abroad surged, the effect on stimulating domestic demand was limited. In January 2025, the number of overseas tourists reached a record high of 2.97 million, and domestic tourism expenditure actually decreased by 7.4% compared to the previous month and by 1.8% compared to the same period last year. Although spending temporarily increased on the day of the temporary holiday, the overall effect of revitalizing domestic demand was not clearly evident.
The report pointed out that even if there are some positive effects of temporary holidays on domestic demand, the negative effects of decreased exports and production offset these or appear even more significant. In January 2025, the number of working days decreased by four days compared to the previous year due to the temporary holiday, resulting in a 10.2% decrease in exports compared to the same month last year. Industrial production also decreased by 1.6% compared to the previous month and by 3.8% compared to the same month last year. The net effect of temporary holidays on the overall economy, in conjunction with economic stagnation, is evaluated to have significantly decreased compared to the past.
The justification of guaranteeing citizens' right to rest also has clear limitations. Temporary holidays are designated arbitrarily at the discretion of the government, making them unpredictable, and under the current Labor Standards Act, they do not apply to business sites with fewer than five employees. As of 2024, about 10 million people, accounting for 35% of all employed persons, do not benefit from temporary holidays. The report suggested that institutional improvements such as expanding substitute holidays and introducing a designated-day system are necessary.
The report emphasized that "the effect of temporary holidays on domestic demand is gradually weakening due to the increase in citizens traveling abroad," and stated that "the designation of temporary holidays should be carefully considered considering their impact on the economy as a whole, including domestic demand, exports, and production." It also noted that "the right to rest is a universal right that all citizens should enjoy, so institutional improvements are necessary to ensure that more people can fully enjoy it."