The number of employed in the rising generation has been reduced to half, resulting in the lowest rate the nation has seen. This is due to the aging population and the unemployment rate of youths.
This drastically reduces labor productivity and the vitality of the economy.
According to Statistics Korea, the leading catalyst for the low employment rates of youths is the declining population in an aging society.
The population in 1980 was 37.4 million of which those aged 15- 29 comprised of 30.4 percent of the total population with 11.3 million people. After 30 years, the total population has risen to 47.9 million boosting the percentage by 28 percent but the youth generation has declined to 10 million, down by 11.8 percent.
The problem lies in the difficulty of finding employment for the rising generation.
As of last May, the entire employment rate rose 65.9 percent from 15.3 million (1983) to 25.3 million, but the youth employment rate dropped 20.7 percent from 4.8 million to 3.8 million.
Within the same time frame, the employment rate of youths plunged from 31.5 percent to 15.1 percent
The rate of college students has doubled from 33.2 percent to 72.5 percent since 1991, and there is remarkable standard of higher education, there is an insufficiency of gainful employment for these youths.
Under these circumstances, the rising generation are seeking only the few limited high quality jobs while they ignore other employment opportunities, causing a "mismatch".
The rising youth turn their cheeks the other way as they wait for job opportunities in large companies due to the differences of income, working conditions, personal development, and inter-company mobility between conglomerates and mid-to-small sized firms.
The labor of youth have made the slumping economy worse. Even in the 2008 financial crisis, the biggest factor was the labor market for the rising generation.
Researchers Hong Seung-hyun and Won Jong-hak of the Institute of Public Finance states in their recent report that because of the unemployment problems of the youth, there has been a sharp increase in the NEET (Not in Education, Employment, or Training) category.
NEET represents youths not employed, in education, or in training. They are also not categorized as unemployed. There are those in the NEET category that are "preparing for employment" but they are outweighed by those considered to be "resting".
Analysis shows 996 thousand people have given up looking for a job after the exchange rate crisis in 2010.
As a result, hundreds of thousands of the younger generation who should be the most active in the workforce are simply lulling around, not making a productive contribution to the economy.
If the labor market of youths decreases and the population continues to age, companies will face increasing expenses. This is due to the expanding incomes of senior workers.
Also, if the rising generation cannot find a stable position early, they will find themselves wandering from job to job or completely unemployed.?In this scenario, if they cannot find their place in the workforce, they will be in a position of poverty where the government will have to increase expenses for welfare programs.
Experts believe the decreasing rate of youth employment will continue for the time being.