Korea’s labor force could drop by 17% in 20 years

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Korea’s labor force could drop by 17% in 20 years

Korea’s labor force is projected to decline 17 percent by 2040, a report showed Monday, a development that could undermine the potential growth of Asia’s fourth-largest economy.

The report of the World Trade Organization (WTO) showed that the decline of Korea’s labor force would be the highest in the world between 2018 and 2040, compared with a 14 percent decline in both Japan and China.

The report said the U.S. labor force is projected to go up 10 percent, while the labor force of Southeast Asia could rise 16 percent during the cited period.

The report said the projections on both population and employment growth show that aging will affect some regions substantially.

“Labor force growth is also projected to become negative in the European Union and the Republic of Korea. Although population growth does not become negative in these regions, the changing age structure is projected to turn labor force growth negative,” according to the report posted on the website of the World Trade Organization.

The WTO report is the latest in a series of warnings on Korea’s rapidly aging population amid its chronically low birthrate.

Korea’s working-age population - those aged between 15 and 64 - could fall to 25.62 million, or 52.4 percent of the population, in 2047 from 37.57 million, or 73.2 percent, in 2017, according to Statistics Korea.

A rapid decline in the working-age population could place a heavy burden on young people to support them and add a further drag on Korea’s potential growth.

The looming demographic decline showed that Korea’s GDP is projected to increase 65 percent by 2040, compared with the global average of 80 percent.

Korea’s GDP growth is far behind China’s 141 percent hike and India’s 226 percent increase.

Yonhap

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