Reversing a brain drain

Oh Ho-young
The author is a senior researcher at the Korea Research Institute for Vocational Education and Training.

A sense of crisis about rural areas is deepening in Korea. The ratio of regions with high risk of disappearance has increased drastically from 1 percent in 2013 to 46 percent in 2020. Since the population in the capital region surpassed that of the non-metropolitan area in 2020 for the first time, population in the non-capital region continues to decrease. We need radical ideas and responses beyond existing regional policies such as regulations restraining the expansion of the capital region and relocation of public agencies to other areas.

A government policy to control overcrowding of the capital region was expected to bring benefits to other areas, but the situation has only been aggravated. For example, local universities are on the verge of bankruptcy due to a sharp decline of the school-age population. The situation has improved a bit, but the crisis of the manufacturing industry starting with the shipbuilding and automobile industries drove provinces into a corner.

For instance, the employment rate in Geoje city, South Gyeongnam, fell to 59.1 percent in 2018 from 64.2 percent in 2016. At the national level, the employment shock in the shipbuilding industry was offset by other industries, but specific regions were seriously hit. Not only Geoje but also Gunsan in North Jeolla, the Ulsan Metropolitan City, Yeosu in South Jeolla and Changwon in South Gyeongsang were all designated as employment crisis regions due to the employment shock from the shipbuilding and automobile industries.

As the fourth industrial revolution will only accelerate in the future, it will have a negative impact on manufacturing jobs. Factors such as developing countries catching up fast, industrial restructuring, and economic cycles also remain a constant. In particular, rural areas with weak manufacturing bases are facing a crisis due to the rapid aging of the population and a steep decrease in young populations.

To revive provinces by creating jobs, it is necessary to establish a body that can integrate local job policies. Local job creation projects by each ministry should be consolidated to avoid redundancy and eliminate blind spots. Japan created the Headquarters for Regional Revitalization directly under the Prime Minister in 2014.

Second, it is necessary to establish a preemptive response system for regions in employment crises. Policies to mitigate the impact after a crisis cannot prevent the decline of a region. Customized strategies by detecting early signs of crisis should be pursued. The smart specialization strategy of the European Union prepares a customized innovation strategy for each region based on analysis of comparative strengths and potential of each region.

Third, it is necessary to improve governance to strengthen local participation in the local job policy making and implementation. The current four-party system based on the labor-management-civilian-government council has limitations in ensuring the actual participation of provinces. The key to successful job creation projects in Gwangju and Gunsan was the accumulation of trust from stakeholders in the region who made concessions and compromises through discussions.

Fourth, it is necessary to introduce a free employment zone system based on social consensus. By introducing the free export zone system in 1970, the government effectively increased exports by breaking out of the regulations of the Building Act, the Foreign Capital Inducement Act, the Trade Act, and the Labor Act. It is necessary for the central government to support local efforts to create jobs by introducing the free employment zone system through legislative support as seen in Gwangju.

Lastly, the focus of local job creation should be on young people. Small cities and counties where young people have left lose vitality and are bound to decline. When the young generation puts their future and hopes in local jobs, a region can find a way to revive. It is urgent for local governments to promote intelligent operations and automation in farming, forestry, and fishery to free local people from hard labor.

Innovative policies and programs should be developed to attract the young digital nomad and revitalizing experience-based tourism, for example. The Ballymun Youth Guarantee project in Ireland, initiated by the Ballymun local government, offers more attractive support than the central government. In Denmark, the Youth Guide Centers work with the central and local governments, educational institutions and employment centers to help improve abilities and qualifications of young people.

Translation by the Korea JoongAng Daily staff.