Korea’s low fertility rate is young people’s cry for better housing, jobs

Posted on : 2022-04-02 09:52 KST Modified on : 2022-04-02 09:52 KST
South Korea’s fertility rate is the lowest in the OECD
(courtesy of Getty Images Bank)
(courtesy of Getty Images Bank)

On Aug. 6, 2009, the scientific journal Nature published a study analyzing the relationship between the total fertility rate and the human development index that was carried out by researchers from the Population Studies Center at the University of Pennsylvania.

The total fertility rate refers to the average number of children that a woman is expected to have during her childbearing years (15-49). The human development index, or HDI, is a number between 0-1 calculated for various countries by the UN Development Programme and based on surveys of educational levels, national income and average life expectancy.

When the researchers surveyed figures from 37 countries from 1975 — the end of the postwar baby boom — through 2005, they found that the fertility rate continued to fall for some time even as the HDI increased. But once the HDI reached 0.85-0.9, the fertility rate began to go back up. The reason for this rebound, the researchers concluded, was that social development brings improvements in work environment and daycare and educational facilities that offset the negative factors of delayed marriage and the high cost of childcare and education.

When the birth rate keeps falling as the standard of living rises

However, the researchers found a few outliers among the countries they studied in which the birth rate didn’t rebound even when the HDI rose. Those countries were Japan, Korea and Canada

Japan’s HDI had risen to 0.94 by 2005, but its fertility rate had dropped to its lowest point of 1.26. Korea’s HDI had also reached 0.91 by 2005, while its fertility rate was 1.08, the lowest of any member of the Organisation for Economic Co-operation and Development. The paper also described Canada as an exception, though with a fertility rate of 1.5, Canada doesn’t seem like a good match for that grouping.

The paper analyzed data until 2005, but what happened after? Since the 2007-2008 world financial crisis, the trend has been for the total fertility rate to decrease again in most major countries.

Outliers Japan and Korea demonstrate opposing trends. Japan’s total fertility rate rose from 1.26 in 2005 to 1.45 in 2015 before falling slightly. Korea’s rate kept dropping steadily, from 1.08 in 2005 to 0.92 in 2019. Since then, it fell to 0.81 in 2021 due to the effects of COVID-19. Korea ranks last in the OECD, and is the only member country with a rate below 1.

Interestingly, the fertility rate for married women is over 2 in Korea as well. The problem is that a growing number of young people are abstaining from marriage. The annual number of marriages has decreased from 329,000 in 2011 to 192,507 in 2021.

Worse still, the labor market cannot meet the expectations of young people so highly educated. The percentage of students enrolling in university rose dramatically from 27.1% in 1990 to 62% in 2000 and then peaked at 73.4% in 2005, after which the numbers plateaued. This is the highest percentage in the world. Looking at data from 2020, however, only 75.2% of South Korean university graduates aged 25-34 found employment as compared to 84.2% in the US, 87.8% in Japan, and over 90% in Lithuania, Switzerland, the Netherlands, and the UK.

Young people prefer regular full-time positions at large companies or in the public service sector, but landing such a job entails fierce competition. According to supplementary results to the survey on the economically active population taken by Statistics Korea in August 2021, there are 3,779,000 workers in their 20s, of whom 1,414,000 (37%) are irregular. Among them, 906,000 are temporary, and 690,000 are part-time.

Whereas the Korean youth employment rate is relatively low by international standards, the elderly employment rate is high. Fearing a decrease in the working-age population, the National Assembly passed a law in 2013 raising the working age to 60. Only the standard conflict between labor and management surfaced then, but last year young people reacted very sensitively when the government proposed the need for an employment extension system for older Koreans. Younger Koreans were concerned that this would further reduce the number of good jobs available to them. Many young people also sideline migrant workers and disapprove of giving irregular workers regular status, with the excuse that they have worries of their own.

Raising children takes time and care, but it also poses a significant economic burden. According to a 2019 estimate by the Centenarian Era Research Institute affiliated with NH Investment and Securities, the cost of raising a child until high school graduation is 200 million won, or around US$164,00, counting in the average cost of private tutoring. Many young people cannot imagine having children because they wouldn’t be able to handle the expense and live the life they anticipated. The price of a home only adds to the burden.

Gender discrimination in the labor market also contributes to the low fertility rate. The rate of women enrolling in university surpassed that of men in 2009. However, the reality is that they are discriminated against in the job market and passed over for promotions. Childbirth leads to career interruptions that in turn undermine their position in the labor market.

Although the employment rate for women in their 20s is 59.6% — higher than that of their male peers at 55.1% — the employment rate for women aged 30-50 is 60%, a whopping 20 percentage points lower than that of men. Relatively more men are single in the lower-income group, while relatively more women are single in the higher income group. This may be because women with high incomes and education levels do not want to lose their hard-earned status by bearing children.

The plunging fertility rate may imply that youth is not merely an age category but a special class suffering poor treatment in this society. The decline in fertility is considered a social problem because it poses major challenges to the sustainability of the pension system, but for young people themselves, it is also a public cry. One could call it a “birth strike.”

Youth have already voiced a reason for the low fertility rate

The fertility rate is very low not only in Japan and Korea, but in other East Asian countries such as Hong Kong, Taiwan, Singapore and Thailand.

Japan’s rate is relatively high within this group, with a total fertility rate of 1.34 in 2021. One thing worth noting is that its rate has stopped plummeting. This may be an effect of the resolution of the problem of youth unemployment, a problem that dogged the society for years after the collapse of the bubble economy. The unemployment rate for 20- to 24-year-olds dropped from 9% in 2010 to 4% in 2020. Most university graduates now successfully find employment. Opportunities opened up for them when the “Dankai Generation,” born between 1947 and 1950, began to retire in large numbers in 2012 after lingering long in the labor market due to an increase in the retirement age.

Will the full-scale retirement of Korea’s baby boomers born between 1957 and 1975 open up job opportunities for youth here as well? It may in terms of numbers, but the boomers remaining in the labor market have mostly already been pushed out of the desirable positions and are unable to pass good jobs on to young people as they retire.

Angry and exhausted facing their bleak prospects, young people made themselves heard politically by showing up at the polls on March 9. We should take this chance to examine their plight carefully, share thoughts, and seek out meaningful solutions.

By Jeong Nam-ku, editorial writer

Please direct questions or comments to [english@hani.co.kr]

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