Baek Byung-yeul is a journalist at The Korea Times focused on cultural content, including films and cultural events in South Korea. You can contact him at baekby@koreatimes.co.kr to share your insights.
Companies do their parts to help increase Korea's record-low birthrate
Children of HD Hyundai employees play with teachers of the company's Dream Boat child care center in Seongnam, Gyeonggi Province, March 9. Courtesy of HD Hyundai
By Baek Byung-yeul
By Baek Byung-yeul
Samsung Electronics, LG Electronics, HD Hyundai, NCSOFT, HanmiGlobal and other Korean companies are strengthening their welfare support structures, providing improved child care centers and fertility support in order to help employees have more children while remaining in the workforce, according to company officials, Thursday.
The family-centric initiatives being implemented by companies here, are all part of efforts to, in some way, help to overcome the country's severely declining birth rate, the lowest in the world.
The officials said that while the government is offering a number of supportive measures to boost the extremely low birthrate, companies are also trying to keep pace with the government and offer support to their employees simply because their own future viability is uncertain without future workers.
Companies are trying to offer better in-house child care centers because many employees think they don't have a reliable way to care for their children if both parents have to go to work. Companies are also increasingly focusing on making it easier for both male and female employees to take parental leave, return from leave and reintegrate back into the workforce.
The reason why companies are even stepping up their efforts to help overcome the low birth rate is that Korea's fertility rate has fallen to a critically low level. According to Statistics Korea, 249,000 babies were born last year, down 11,500 or 4.4 percent from 2021. The fertility rate, which refers to the number of children a woman can expect to have in her lifetime, hit 0.78.
Lee Jae-yong, executive chairman of Samsung Electronics, speaks with the company's female employees at its Suwon headquarters, to hear about the challenges they face in juggling child care and work and how the company can improve, Aug. 6, 2020. Courtesy of Samsung Electronics
To contribute to improving the birthrate through positive developments in employee welfare, Samsung Electronics, the largest conglomerate here, has allowed employees to take two years of parental leave since 2015, double the legal limit of one year. It also has enabled employees to take parental leave until their children reach the age of 12, up from the legal standard of 8 years old.
The move to bolster welfare support for its employees is in line with its Executive Chairman Lee Jae-yong's philosophy, which is to utilize the leadership of skilled female employees. Through this philosophy, the company has improved its support systems to help female employees balance work and child care.
“Since last year, Samsung has also introduced a re-boarding program for employees returning from parental leave such as providing job training, mentoring and support for working from home. The idea is to make it easier for them to adjust to work life after taking parental leave,” a Samsung Electronics spokesman said.
LG Electronics also allows employees to take up to two years of parental leave. Since 2020, the company has also provided three days of paid leave for employees who take time off for fertility treatments, even though the law requires only one day of paid leave.
“Since last year, LG Electronics has provided up to two years of parental leave so around 500 to 600 employees have taken their parental leaves so far,” a company spokesman said.
HD Hyundai has been actively working to resolve child care issues by subsidizing employees' preschool education expenses for their children by providing a total of 18 million won ($14,000) for three years prior to their children entering elementary school.
“In addition to subsidizing scholars, President Chung Ki-sun decided to open the Dream Boat child care center to address child care issues, which are a major concern for employees. The day care center, which opened in March, is free to employees with children aged 5 and under from 7 a.m. to 10 p.m. and is open to all employees,” a company spokesman said.
HanmiGlobal, a local construction project management company, has been in the spotlight for its unprecedented low birthrate support measure, as its Chairman Kim Jong-hoon recently announced that an employee who gives birth to a third child will be promoted to the next-highest position right away.
“The chairman has a philosophy that people who give birth to children are heroes in this era. He believes that the way to save Korea, which is suffering from a declining birth rate, is to have more children,” a company spokesman said.
“In addition to this extraordinary promotion system, HanmiGlobal has provided more support for childbirth and marriage than other companies. The company pays 1 million won for the first birth, 2 million won for the second, 5 million won for the third and 10 million won for the fourth. It also provides free fertility treatments for employees who have difficulty conceiving,” the official added.
Children of NCSOFT's employees study foreign languages at the company's in-house day care center Laughing Peanuts in Seongnam, Gyeonggi Province. Courtesy of NCSOFT
Game company NCSOFT also has long operated its in-house day care center Laughing Peanuts at its headquarters in Seongnam, Gyeonggi Province. The company opened its first in-house child care center in April 2008, and it moved to the Pangyo R&D Center in 2013 and expanded the center to Laughing Peanuts. The company is now operating two child care centers with the opening of another one in Alpharium Tower in March 2022.
“Our child care center can take care of a total of 300 children of employees. Laughing Peanuts received the highest grade of A in the government's child care evaluation. In addition to the basic education curriculum provided by the government, the curriculum for children to experience foreign languages such as English and Chinese is planned and developed by a dedicated in-house department,” a company spokeswoman said.
Criticizing the government for spending an enormous amount of the budget on fertility promotion despite the rate continuing to decline, Kim Dae-jong, a professor of business administration at Sejong University, said that he is in favor of companies providing their own support.
“Korea has the lowest birth rate in the world. This is because we have to pay too much in private education fees and child care costs. The presidents we have elected so far have told people to have children and the government will raise them for free, but they only pay about 100,000 won a month. Private companies are stepping up to the plate because the government is not providing proper childbirth support,” the professor said.
The professor added that the government should refer to the example of France, where it costs almost nothing to educate children until they graduate from college, or Japan, which pledged recently to increase its parental leave rate for male employees to 85 percent by 2030.
“The birthrate is so low that the country's economy is struggling to survive. With the influx of people from abroad, we should take a cue from how other countries are trying to increase their birthrates and how they are making it easier for their citizens to educate their children,” he said.