South Korea's Employment Statistics and Economic Challenges

South Korea's youth faces job scarcity; policy favors unwanted jobs, neglects innovation, and perpetuates obsolete industries.

### South Korea's Looming Economic Challenges and the Imperative for Innovative Job Creation
* 📉 Despite seemingly strong employment statistics with indicators like a **62.6% employment rate**, a **64.3% economic activity participation rate**, and a **2.7% unemployment rate**, the reality is that the **quality and types of jobs being created are not aligning with the aspirations of the youth**.
* 👩 Young people prefer opportunities that involve risk and have future growth potential, but the current job market in South Korea is dominated by low-wage positions like delivery riders.
* 🏭 Many companies in South Korea, especially small and medium-sized enterprises (SMEs), are struggling, with **42.3% unable to generate enough cash to even cover their interest payments**. This situation is exacerbated by the **lack of clear growth prospects** and the **heavy reliance on government support**.
* 🌱 The OECD has warned that the presence of these "**zombie**" companies could have a **detrimental impact on the overall economy** by stifling resources and opportunities for innovative firms.
* 🎓 The lifelong earning gap based on university ranking is significant in South Korea, with graduates from top universities enjoying a **wage premium throughout their careers**. This highlights the **importance of the first job** and the **limited social mobility** in the country.
* 👶 The traditional belief that "**work is the best welfare**" is being challenged, as the changing economic landscape requires a shift towards supporting jobs that **drive innovation and growth**.
* 🚪 However, the existing political and economic structures in South Korea make it difficult to **reallocate support away from zombie companies** and towards **future-oriented industries**.
* 💡 It is crucial to have a forward-looking approach to job creation and economic policy in South Korea, one that fosters an environment where **innovative companies can thrive** and where the **aspirations of the youth are met**.

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압권 Apkwon

The Republic of Korea's Youth Employment Dilemma

The Republic of Korea has seen an overall increase in employment, but the majority of new jobs are being taken by people aged 60 and above, leaving the younger population struggling to find work.

The country's focus on creating regular, low-risk jobs has led to a decrease in opportunities for young people who are seeking more challenging and innovative work.

This has resulted in a significant gender and age imbalance in the workforce, with more women over 60 entering the workforce while the number of men under 60 in employment has decreased.

As a result, the youth in South Korea are facing a lack of opportunities for the type of work they desire, leading to a challenging economic future.

Changes in the Non-Economic Active Population and Employment Trends

The non-economic active population has decreased by 134,000, with a significant decrease in childcare activities.

The number of people studying, taking classes, and on leave due to illness has increased, while the healthcare and social welfare services industry has shown the most significant increase in employment, with a decline in the growth rate of nurses and medical assistants.

This reflects a shift in employment patterns, with more young women pursuing jobs in healthcare and middle-aged women in social welfare services.

The dynamics of the non-economic active population and employment trends indicate complex societal changes that cannot be simply attributed to laziness or lack of motivation.

The Impact of University Education on Lifetime Earnings

The wage gap between graduates of different universities starts at 25% at age 20 and widens to 51% as they get older.

Graduates from prestigious universities and good workplaces continue to have the highest wages throughout their lives.

Many young people, including riders, are part of the workforce, facing structural issues that limit their earning potential.

Small and medium-sized enterprises are struggling financially, raising questions about government support for these businesses.

Government Support for Small and Medium-Sized Enterprises

The scale of government-guaranteed loans for small and medium-sized enterprises is over 40% of GDP, far exceeding the OECD average.

Despite the wide range of support initiatives, there are concerns about the growth potential and the reliance on government support for these enterprises.

The changing economic landscape and the need to allocate funds more effectively raise questions about the sustainability of current support policies.

The Impact of Zombie Companies on South Korea's Economy

Zombie companies selling at low prices are preventing the emergence of innovative companies in South Korea.

The OECD has reported that the exit of zombie companies could benefit the economy by allowing resources to flow to more innovative ones.

The current focus on supporting small and medium-sized enterprises in South Korea needs to shift towards promoting productivity and innovation, especially with the changing economic landscape.

The Impact of Innovation on the Korean Economy

Government support and policies designed to protect existing industries have hindered disruptive innovation in South Korea, leading to a significant decrease in the country's new growth engine.

The situation is reflected in employment statistics, indicating the need to reevaluate the allocation of support funds towards areas with the potential for innovation and regulatory reform.

Instead of supporting stagnant "zombie" companies, there is a call to focus on creating jobs that align with the preferences of young people and to improve the treatment of real workers in small and medium-sized enterprises.