ACCORDING TO an official figure released last August by a national statistics agency Statistics Korea, South Korea has recorded the world’s lowest fertility rate—struggling to reverse its trend of declining fertility rates for six consecutive years[1]. To alleviate this issue, the South Korean government has enacted several policies, including the child care subsidy, immigration-friendly system, and an extended parental leave. Nonetheless, there remains concerns regarding these measures and the prospect of Korea’s declining population. 

Low fertility rate

   In 2021, South Korea’s fertility rate[2] shrunk from 0.84 to 0.81, which is significantly lower than the recommended fertility rate of 2.1 to maintain a country’s stable population size[3]. Even though other developed countries including the United States and Japan are also suffering from low fertility rates, their average rate of 1.6 is significantly higher than that of Korea[1]. In this regard, the Organisation for Economic Co-operation and Development (OECD) underscored that South Korea has been particularly pronounced in the drastic reduction of family size—noting that the fertility rate of Korea during the 1970s was four[4]. 

   A low fertility rate entails serious consequences such as labor and consumer shortages, which are important factors that contribute to the domestic economy. Lee Sang-lim, a demographer at the Korea Institute for Health and Social Affairs, warned of a serious labor shortage by the mid-2030s with a drastic population decline in Korea[5]. The problem becomes more serious for Korea due to its increasing aging population as this indicates that a limited working-age population will have to support the increasing elderly population. As of last November, 16.8% of South Koreans were over 65 years old while only 11.8% were aged 14 or under[1]. This phenomenon will eventually leave the younger generation in South Korea with burdensome amounts of tax to support the elderly. In an interview with The Yonsei Annals, Lee Ji-ho (Jr., UIC, Dept. of Integrated Science and Engin.) emphasized that “the amount of tax levied on our generation in the near future for [greater number of] the elderly population will be demanding.” Moreover, a shrinking workforce can lead Korea into the risk of secular stagnation—becoming “a bottom economy with no [economic] growth among the OECD members[7].” In a long-term public finance report published last year, the OECD predicted that Korea’s potential per capita GDP growth will become zero by 2030[6].

Policies

   One of the primary causes of Korea's low fertility rate is the rising childcare costs. Based on the data released by the Korea Institute of Child Care and Education, Korean parents spend an average of ₩200,000 per month on childcare[3]. Korean parents perceive education as the crucial vehicle for their children to achieve success—causing them to participate in the nation’s education fever[7] by sending their children to private education centers that are notoriously expensive. As of 2021, the average amount spent per capita on private education was ₩367,000 per month, and it was common to find families spending within the range of ₩1 to ₩2 million monthly for education. 

   Moreover, housing costs in South Korea are very high, discouraging expectant parents to have a child. Having a nest for a family in Korea requires a large loan, especially in recent years due to the low interest rates. According to Bloomberg, an average house in Seoul costs an individual’s 18 years of average annual earnings—daunting enough for young couples to refuse family expansion[8]. To accommodate these financial problems and encourage more births, President Yoon Suk-yeol and his administration are planning to provide every family with a new-born child a monthly allowance of ₩1 million for one year[9]. The payment will start this year at the initial level of ₩700,000 a month—rising to the full amount by 2024[9].  

   Furthermore, the Yoon administration aims to facilitate immigration policies to cope with the lack of workforce from falling fertility rates, especially when there are fewer people wanting to do low-wage, physically demanding jobs. As a solution, the government hopes to allow more immigrants to augment these jobs. Chung Ki-seon, a migration expert at Seoul National University, also emphasized that South Korea should take in migrants to supplement its agriculture, fishing, construction, and manufacturing workforce from the demographic imbalance[8]. In the interview, Lee also mentioned how “immigrant workers could be a great replacement for the lacking workforce in specific areas where the younger generation is reluctant to work.” Thus, the South Korean government promised to open a central bureau overseeing immigration policies to loosen immigration protocols[10], and Justice Minister Han Dong-hoon proposed two possible programs to attract and retain immigrants[12]. While a region-specific visa will encourage foreigners to work in regions with serious population declines, a fast-track citizenship and residence permit will bring highly-skilled applicants to Korea.  

   Lastly, the Yoon administration is planning to expand the period of parental leave for working parents to one year and six months instead of the current one-year allocation. The Ministry of Employment and Labor announced that this is an effort made by the government to reduce the couples’ burden of having to sacrifice their career when having a child[11]. They believe that this change will increase the country’s fertility rate by resolving couples’ concerns about career interruptions and encouraging them to seek parental leave more easily. 

Problems

   Despite the Yoon administration’s efforts to resolve the country’s demographic crisis, there are still doubts on whether these measures will effectively reverse the low fertility trend. This is because monetary support has been a common, yet ineffective solution until now. For example, the previous administration of Moon Jae-in, like the current government, provided each newborn child with ₩300,000 a month[9]; the results have been underwhelming with the fertility rate continuously declining. 

   Secondly, public opinion is against mass immigration due to the public's strong belief in a homogeneous culture. This makes it difficult for immigrant workers to quickly fill the void in the workforce. In a 2018 survey by National Public Radio (NPR), 75% of South Koreans favored either maintaining or decreasing the current levels of immigration, which was 3.4% of the population at that time[3]. Also, many migrant workers acknowledge Korea’s poor working conditions against foreigners, making them reluctant to come to Korea. Based on a Labor Ministry inspection released in 2021, nearly 70% of migrant workers were found to be living in makeshift structures, and only 25% of them stayed in houses[15]. Additionally, more than ₩150 billion were reported as unpaid wages for migrant workers[3]. 

  The parental leave system does not seem to be a practical solution. Many workers in Korea emphasize how parental leave entails punishments or penalties. According to the Ministry of Employment and Labor, the number of workers who experienced unfair treatment due to parental leave is rising. In 2017, 78 people requested consultations at the center after being penalized by their employers—increasing to 352 as of 2021[6]. For instance, a female worker in Namyang Dairy Products confessed about being removed from her original post to a completely different post after she returned from a year of maternity leave in 2015[6]. Unless these disadvantages following parental leave disappear, the efficacy of an extended parental leave will remain doubtful. 

Remaining concerns

   There are other crucial factors for the falling fertility rate that the Korean government is not sufficiently addressing. Many South Korean women are now receiving higher education; the share of women who are university graduates surpassed men in 2012, and is now 9% higher than men[10]. Thus, women nowadays have increased labor market opportunities, and they are less inclined to follow traditional family roles in which women were expected to stay at home and take care of children.

   In the interview, Lee shared how many of her female colleagues are not considering motherhood as an obligation anymore; they now “value their future career as important as having a child.” Furthermore, Korean work culture gives significant pressure on women to leave the labor market once they become a mother—still seeing them as the homemaker and the primary caretakers of children. In fact, Korean women “spend 4.4 times more time on unpaid work such as child care and grocery-shopping than men in Korea[12],” the third highest OECD country after Japan and Turkey[12]. 

   Also, it is very challenging for Korean women to balance their careers with a child. Not only is parental leave an impractical option from the fear of retribution at work, but securing child care is another notable struggle. According to government data in 2021, 44.7% of parents responded that they are waiting for their child to be admitted to a nursery, with the average waiting time being 6.9 months[13]. Hence, Korean women are expected to choose between having a family and having a career, and those with degrees now choose the latter, not wanting to sacrifice the career they have built up until that point in their life. As a result, Korean women have begun to postpone having children; some even choose to remain childless. Therefore, to truly understand the current situation and reverse this trend, the Yoon administration should increase efforts in trying to make Korea’s work culture a more gender-equal environment, where women can maintain their careers while having a child. 

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   As South Korea’s population is constantly shrinking and aging, the South Korean government under President Yoon is proposing measures to halt the dangerous tide that could bring a looming shortage of workers and economic anxiety for younger generations. With most of the Yoon administration’s policies being similar to those of the previous administrations that proved ineffective, there are doubts regarding the Yoon administration’s proposed measures. It seems imperative for the Korean government to tackle the country’s work culture that discriminates against female workers. Therefore, it is concerning whether these new policies can bring positive outcomes to halt the nation’s declining fertility rate.

[1] CNN

[2] Fertility rate: The average number of children supposed to be born to a woman during her reproductive years

[3] The Korea Herald

[4] BBC

[5] The New York Times

[6] Korea JoongAng Daily

[7] Education fever: Parental zeal for providing their children an unusual level of education for their admissions into prestigious universities

[8] Bloomberg

[9] Hankyoreh

[10] NPR

[11] The Korea Times

[12] The Japan Times

[13] Reuters