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Why are so many young Koreans not working?

There are more graduates, but fewer good jobs due to the slowing economy.

Sept 23,2008
As recruiting season gets well and truly under way, numerous job fairs are being held these days. Meanwhile the government unveiled a scheme to create new jobs by spending 1 trillion won ($858 million) over the next five years to train 100,000 people for promising industries of the future, to solve the problem of unemployment among young adults. The industry sectors targeted by the government include renewable energy, the environment, cultural content, information and telecommunications, medical and bio-technology, robotics and the so-called ubiquitous city.

President Lee Myung-bak promised to create 300,000 jobs a year. However, with high oil prices and financial turmoil from the subprime credit crisis in the United States, fewer than 200,000 new jobs have been created in recent months.

According to the National Statistical Office, 63.2 percent of Koreans in their 20s were economically active in August, the lowest figure since June 1996.

This means that the economically inactive population of 20-somethings has increased faster than the number of people searching for jobs.

Some say it is only the tip of the iceberg.

Observers say that those who are “not in education, employment or training,” (NEET) are problems. They are educated but have no desire to find work.

“The NEET population includes those who are staying in gosichon and preparing for government or other exams,” said Cho Joon-mo, an economics professor at Sungkyunkwan University. Gosichon refers to an area with a cluster of people living in gosiwon, cheap boarding houses, while preparing for government exams. “If we include those similar to Japan’s hikikomori [social recluse] and the young jobless, the NEET population in Korea is at least 1.3 million.”

Including part-time workers, one in 10 young adults is unemployed.

Besides the hikikomori, Japan is also experiencing problems with “Net cafe refugees,” or homeless young people who live in Internet cafes, and the so-called parasites, young adults who live off their parents and don’t have jobs.

The Japanese government estimates that there are 5,400 Internet cafe refugees in Japan. Most of them are in their 20s or early 30s. About one-third of all employees in Japan are irregular workers, an increase of 10 percent from 10 years ago. A large number of young people are irregular workers, which has become a serious problem in Japan.

According to research, part-time workers total 12.7 million and the NEET population is 900,000 in Japan.

“The higher the number of NEET, who have no income, the less economic growth potential the country has,” Cho said. He added that an increase in the NEET population would be a serious threat to the labor market and likened it to a “tsunami.”

Though not included in the NEET population statistics, those in college for more than four years and those who spend months studying for the Test of English for International Communication, are also serious problems. Incruit, a recruiting information Web site, studied the number of years students remain in college by surveying 14,000 students.

On average, male students take seven years and two months to graduate from four-year colleges while female students take four years and eight months.

“Toeic has become another scholastic ability test as companies have failed to develop diverse ways of recruiting college graduates,” Cho said. He added that the problem is that Koreans take too long to finish college and spend too much time studying for Toeic.

Observers say people involuntarily become part of the NEET population because there are fewer decent jobs due to a slowing economy.

“Manufacturing industries have become less labor-intensive but more high-tech, which has resulted in a decrease in the number of jobs, while the number of people with higher degrees has increased,” said Shin Kwan-ho, an economics professor at Korea University.

“More jobs need to be created in financial, legal and educational services,” Shin added.

Oversupply of college graduates is another reason. Eighty-two percent of high school students advance to college in Korea - the highest percentage in the world.

“I advise students to enter job training such as computer skills but they insist on going to college instead,” said Yun Sang-cheol, a teacher at Kyunghee Girls’ High School. “Oversupply of college graduates is a cause of the NEET problem.”

“The employment rate of young adults who live with their parents is higher than those who live independently,” said Sohn Min-joong, a researcher at Samsung Economic Research Institute. “Young adults dependent on their parents are creating the NEET phenomenon.”

Professionals are concerned with the increasing number of those who voluntarily become NEETs, like those who study for government exams.

“Bill Gates was successful because he was faithful to the principle of high risk and high returns,” Shin said. “The fact that young people are trying to hold on to low-risk government jobs is not desirable for the society in general.”

Some say young adults do not have proper values about careers and that this is why they have a weak desire to work.

The Korea Research Institute for Vocational Education and Training surveyed 1,200 workers in the United States, Japan, Germany and Korea between July and August last year to gauge their sense of professionalism. The study showed that Koreans have a high regard for the public sector or what are considered here “noble” occupations, like pharmacists and teachers. Meanwhile, they had less respect for private sector jobs unlike in other developed countries. University graduates do not compromise and take low-skilled jobs.

“Top students go to either law school or medical school and this is our reality,” Yun said. “We need to provide students with better information about various job fields and opportunities to gain experience in different jobs.”


By Park Gil-ja NIE Research Institute [jbiz91@joongang.co.kr]



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