Youth Disengagement From Work Deepens Structural Worries in Korea (Image supported by ChatGPT)
SEOUL, Jan. 20 (Korea Bizwire) — A growing share of young South Koreans are stepping away from the labor market altogether, a shift that economists say reflects deeper structural strains in an economy struggling to adapt to technological change and slowing growth.
According to a report released Tuesday by the Bank of Korea, the proportion of people aged 20 to 34 classified as “resting” — neither working nor actively seeking employment — rose to 22.3 percent in 2025, up sharply from 14.6 percent in 2019.
The category includes individuals who are not employed and are not participating in job searches, education or training, without specific reasons such as illness or child care responsibilities.
Within that group, the number of young people who said they had no desire to work at all climbed to about 450,000 last year, compared with 287,000 before the pandemic.
While those with junior college education or less continue to make up the largest share of the “resting” population, the central bank noted a striking change: university graduates are increasingly joining their ranks, suggesting that disengagement from work is no longer confined to the least educated.
A job fair in Busan, some 325 kilometers southeast of Seoul, is filled with job seekers in this June 27, 2025, file photo. (Image courtesy of Yonhap)
The Bank of Korea attributed the trend to structural shifts in the labor market, including the rapid spread of artificial intelligence, companies’ growing preference for experienced workers and the broader slowdown in economic momentum.
The report also challenged a common assumption — that young people remain outside the job market because their wage expectations are unrealistically high. On average, “resting” youths reported a minimum expected annual salary of about 31 million won, roughly $21,000, a figure broadly in line with other unemployed young adults.
Economists warn that the implications could extend well beyond short-term employment figures.
“The rise in young people who have effectively exited the labor market risks shrinking the labor supply not only in the near term but over the long run,” said Yoon Jin-young, a Bank of Korea official who authored the report. “That, in turn, could undermine the country’s overall growth potential.”
Mr. Yoon said the issue should not be viewed as a temporary downturn tied to the business cycle, but as a structural challenge requiring sustained policy responses — including stronger incentives to draw young people back into work and reforms aimed at improving the quality and accessibility of youth employment.
Lina Jang (linajang@koreabizwire.com)
