SEOUL: South Korea's unemployment rate surged to an 11-year high in December, while the number of employed plunged at the fastest rate in over two decades, as stringent COVID-19 curbs at home intensified pressure on businesses.

The seasonally adjusted unemployment rate jumped to 4.6% in the final month of 2020, up from 4.1% in November and the worst since January 2010.

For the 2020 year it stood at 4.0%, the highest since 2001, data from the Statistics Korea showed on Wednesday.

The data also showed the number of employed was 26.5 million in December, 628,000 fewer than a year earlier, marking the worst downturn since February 1999.

"Damages on retail, accommodation and restaurant businesses were the biggest strain for December figures," Statistics Korea official told Reuters.

Breakdowns showed workers at retailers, accommodation facilities and restaurants were the hardest hit last month, as the numbers of new jobs fell 511,000 from a year earlier.

Those at manufacturers also took a big hit with the number of new jobs falling 110,000 year-on-year.

South Korea raised its social distancing measures for the metropolitan Seoul area enforcing a ban on gatherings of more than 50 people and shutting most businesses including restaurants by 9 p.m, on Dec. 8.

The daily virus cases surged to a record level in late December, leading to more new restrictions, but that has slowed in recent days thanks to the nation's aggressive tracing and testing system.

South Korean president last week pledged to expand support for those vulnerable to job insecurity, including temporary workers, daily labourers and youth.

Asia's fourth-largest economy is set to shrink in 2020, the first contraction in 22 years, even as the government rolled out around 310 trillion won ($283.28 billion) worth of stimulus last year. Preliminary 2020 GDP data will be released later this month by the Bank of Korea.