Local residents wait to cast their ballots for parliamentary elections at a polling station in Seoul, South Korea, Wednesday, April 13, 2016. South Koreans on Wednesday voted in the parliamentary election that many predict will hand President Park Geun-hye's conservative party a decisive win, despite frustrations over a sluggish economy. (AP Photo/Ahn Young-joon)

SEOUL, South Korea - South Korean voters handed President Park Geun-hye a stunning political setback by denying her conservative party a majority in the next National Assembly, poll results showed Thursday.

The outcome, which came as a surprise to many, will likely threaten Park's plans to push ahead with controversial economic reforms, including plans to make it easier for companies to lay off workers, and blow open next year's presidential race. The emergence of a new centre-left party also ensures further changes to South Korea's political landscape, which had long been shaped by two-party dynamics.

Prior to Wednesday's parliamentary election, pollsters had predicted that the ruling Saenuri Party would crush a divided opposition and raise its expectations to take the presidency in 2017, after Park's single term expires.

But after all the votes were counted Thursday morning, Saenuri wasn't even the party with the largest number of seats, let alone a majority in the 300-seat assembly.

Saenuri managed to win 122 seats, one less than the main opposition Minjoo Party, which trounced its rival in the capital Seoul and the neighbouring metropolitan area, where the two largest parties competed most fiercely.

The People's Party, a new party created mostly by those who left Minjoo, including its former co-chairman and potential presidential candidate Ahn Cheol-soo, won 38 seats after dominating Minjoo in its traditional strongholds in the southwest Jeolla regions.

Saenuri could possibly overtake Minjoo as the largest party in the next assembly if it manages to lure back some of its former lawmakers who left and ran successfully as independents. They left Saenuri after being denied nominations amid a rift between the party's dominant faction loyal to Park and reformists, which analysts say damaged the party's appeal to voters.

There has been disappointment among South Koreans over a sluggish economy, with official figures showing household debt reaching new highs and the unemployment rate for people under 30 reaching levels not seen since the late 1990s, when millions lost their jobs during a crippling financial crisis.

The outcome of the vote indicates that the opposition parties have successfully absorbed conservative voters who have become disappointed with Park. Months before the vote, Minjoo brought in as chairman scholar-turned-politician Kim Chong In, who had advised Park on economic policies during the 2012 presidential campaign. Ahn, the founder of one of South Korea's largest computer software companies, has portrayed himself as a politician whose strength is with economic issues.

The weak showing by Saenuri also shows that voters weren't swayed by national security issues as much as they were before, although surveys taken prior to Wednesday's vote showed strong support for Park's hard-line approach to North Korea following its recent nuclear test and long-range rocket launch.

Hostility between the rival Koreas in election years has often been seen as helping the conservatives by allowing them to highlight their hard-line approach against the North. Liberals have traditionally backed rapprochement policies with the North.

The election commission said 58 per cent of the country's 42 million voters participated in Wednesday's election, a higher turnout than four years ago, when 54.2 per cent of the electorate turned out. It wasn't immediately clear whether larger participation by younger voters, seen as more likely to vote for liberals than voters over 50, contributed to the increase in turnout.

Since losing its second consecutive presidential election in 2012, the Minjoo Party has struggled with factional infighting and lawmaker defections, and saw its seats decline from 127 to 102 in the current assembly.

South Korea's electorate is deeply divided along generational and ideological lines, and also by fierce regional loyalties. Voters in the southeast Gyeongsang regions have for decades overwhelmingly voted for conservatives in parliamentary and presidential elections.

News from © The Associated Press, 2016