Young Koreans shun manufacturing jobs for easier hospitality roles

Industry

Published: 17 Jan. 2024, 07:00

Young Koreans shun manufacturing jobs for easier hospitality roles

Smoke rises from the Banwol Industrial Complex located in Ansan, Gyeonggi, in December 2023. [NEWS1]

Workers aged 60 and above surpassed those in their 20s in the manufacturing sector workforce last year, constituting a record-high 13.4 percent of all manufacturing employees.

The switch in the leading demographic comes as more older people enter the country's backbone manufacturing sector while the younger generation workforce shrinks.

There were 599,000 workers over 60 in the manufacturing sector last year compared to 545,000 workers in their 20s, according to Statistics Korea’s labor force data published Sunday. The data covers both national and foreign manufacturing workers in Korea.

The proportion of manufacturing workers over 60 first exceeded 10 percent in 2021 and has continuously risen to reach 13.4 percent last year.

Workers aged 60 and above surpassed those in their 20s in the manufacturing sector workforce last year. [YOO YOUNG-RAE]

Lee, who operates a glass bottle manufacturing business in Gwangju, Gyeonggi, hired a 38-year-old worker. This worker is the youngest hire Lee has employed in the last two years.

“It’s not a small number of people over 60 [who work here]. It’s best to hire young people and educate them so that they can work for a long time, but it’s been a long time since I’ve let go of such expectations,” Lee said. “It isn’t too bad here since the factory isn’t too far away from Seoul and the workload is relatively light but the aging [of workers] is worse in other places.”

The increase in manufacturing workers over the age of 60 has mainly been driven by the aging population. According to Statistics Korea’s data, there were 10.776 million people over the age of 60 in 2018, which rose by 26.9 percent over five years to 13.674 million people last year. The number of people in their 20s shrunk by 258,000 people over the same period. The increase in the total labor force last year was therefore also led by the older population.

Excluding those in some major corporations, the younger generation has pushed aside jobs in the manufacturing sector for other industries. The manufacturing sector was for a long time the sector where people in their 20s most found jobs, but lost its top spot for the first time last year to the services sector.

This is due to more people getting jobs in the lodging and food industries. Last year, 574,000 people in their 20s found employment in the lodging and food industry, up 37,000 people from the 537,000 workers in the industry in 2022. This is 29,000 workers more than in the manufacturing sector.

Though there are many vacant jobs available in small and medium-sized businesses in the manufacturing sector, experts find that young people have instead chosen to work at restaurants and cafés that do not require specialized skills while it is relatively easier to get employed.

According to the Bank of Korea’s statistics on the growth rate of manufacturing employment by age group, comparing data recorded before the Covid-19 pandemic to last year’s third quarter, employment by people in their 30s fell by 15 percent and by 5.2 percent for those in their 40s. Employment found by people in their 60s rose by 34.3 percent. This means only older people, who have difficulties finding jobs in other sectors, are applying for manufacturing jobs.

“It has reached a point where no young job-seekers are looking for employment at small and medium-sized manufacturers outside of the Seoul Metropolitan Area,” said Korea SMEs & Startups Institute's research fellow Noh Min-sun.

“Small and medium-sized [business] manufacturing jobs are shunned as most job-seekers are college graduates,” Noh added. “Paths where vocational high school graduates can find jobs in small and medium-sized enterprises and grow into field masters should be vitalized.”

Exports have picked up starting in the second half of 2023, but the slump in exports has directly affected the domestic manufacturing sector. The mining industry has recorded on-year drops in production for four quarters straight, starting from the fourth quarter in 2022, when production dropped on-year by 6.4 percent, up to last year’s third quarter when it dropped 2 percent.

Analysts say that high-quality jobs have not been created due to the business slowdown.

“Major companies including Samsung Electronics and Hyundai Motor, where young people seek employment, are increasing overseas investment over domestic investment. This means it is difficult to increase domestic employment to the same level as before,” said Chung-Ang University economics professor Lee Jung-hee.

“Young people are flocking to the service industry, mostly to [find employment in] low value-added services such as restaurants and delivery industries, which is concerning in terms of long-term growth.”

BY JEONG JIN-HO, KIM JU-YEON [kim.juyeon2@joongang.co.kr]