SEOUL, Dec. 5 (Korea Bizwire) — Individuals between the ages of 30 and 54, typically known as the principal breadwinners in South Korean society, are participating less in economic activities.
This trend raises concerns that this disruption to the labor market could develop into a serious social issue which may negatively impact South Korea’s overall economy.
Research from the Bank of Korea (BOK) shows that individuals between the ages of 30 and 54 account for 93.1 percent of overall economic activity in South Korea, a major decrease from 95.9 percent in 1996.
Among advanced economies, the demographic critical for supplying labor and productivity is between 25 and 54 years of age.
Researchers in South Korea, however, typically narrow the range to between 30 and 54 to account for mandatory military service for men and high rates of college enrollment.
The polarization of jobs resulting in a decrease in the number of skilled workers is being pointed to as one of the major causes of the drop in economic participation among men.
This means that if jobs are divided into three different categories of high-skilled (manager, specialist), mid-level (officer, assembly line workers), and low-skilled work (salesperson, physical laborer), mid-level jobs typically held by the demographic critical to labor supply are disappearing.
Mid-level jobs accounted for only 55.5 percent of the job market as of last year, shrinking from 60 percent back in 1994. By 2003, manufacturing and construction jobs had decreased as factories moved overseas.
Since then, the mid-level jobs dealing with standardized tasks have been disappearing due to computerization and the automation of manufacturing processes.
According to the BOK, the number of mid-level jobs dropped by 3.5 percent between 2004 and 2017, with 3.1 percent resulting from computerization, automation, and other factors related to technological advancement.
This phenomenon has also been observed in other advanced economies.
For South Korea, however, the working age population (15 to 64 years old) has been shrinking since last year, raising concerns that the decline in economic participation will take a higher toll on the economy.
A lower capacity to supply labor may cut down on the potential for economic growth.
The increasing number of unemployed men in the core labor age group may lead to lower household incomes, the dissolution of families, and other social issues.
“On-the-job training for newly emerging industries is important to prevent core working age men from leaving the labor market,” said the research team.
H. M. Kang (firstname.lastname@example.org)