Amid Korea's birthrate crisis, Booyoung is paying employees for having children

Industry

Published: 05 Feb. 2024, 18:57

Amid Korea's birthrate crisis, Booyoung is paying employees for having children

Booyoung Group Chairman Lee Joong-keun poses for a photo after presenting a childbirth incentive to a family with multiple births. Lee announced the initiation of a scheme offering 100 million won in cash per child to the 70 employees who have become parents since 2021 in response to the serious low birthrate issue. [YONHAP]

Korean property and construction giant Booyoung Group announced an initiative offering 100 million won ($75,100) per child for employees becoming parents, coupled with a proposal to provide rental housing for those with three or more children.

Booyoung Group Chairman Lee Joong-keun presented the incentive program during a New Year's kickoff meeting held at the company's headquarters in Jung District, central Seoul, on Monday in a bid to tackle the country's chronic low birthrate issue. Seventy employees who have become parents since 2021 were recognized with a total of 7 billion won in incentives.

"If Korea continues to grapple with the ongoing low birthrate, the nation is likely to encounter a crisis in two decades involving a decline in the working-age population and shortages in defense manpower for national security and order maintenance," said the 84-year-old chairman. "We will continue to take actions that businesses can undertake to address the issue."

"Lee also serves as the president of the Republic of Korea Air Force Internet Society, and he has deep concerns regarding the ongoing decline in the birthrate and directly impacts defense manpower," an official from Booyoung said. To maintain the current military force levels, an annual intake of 200,000 individuals is necessary, while newborns in 2022 amounted to only 250,000.

"I had concerns about the financial challenges of raising a child before and after childbirth, but thanks to Booyoung Group's extraordinary support, I can now plan for a second child," said Song Jeong-hyeon, an employee at the company who gave birth on Jan. 3.

Booyoung, focused on the rental housing business, also suggested providing permanent rental housing for employees with three or more children.

"If land is provided by the government, for employees with three or more children, we'll let them choose between a childbirth incentive equivalent for three newborns or a public housing-like rental home [with no tenant tax burden or maintenance responsibilities]," outlined Lee, expressing readiness to supply permanent rental homes to families with multiple children if private businesses are allowed to participate in the current government project for permanent rental housing.

In addition to the childbirth incentives, Lee proposed a tax-free donation system for childbirth incentives. The suggested approach involves making the received amount tax-exempt and offering donors tax deductions for both income and corporate taxes equivalent to the donated sum.

Booyoung is the first Korean company to give out 100 million in substantial cash support per newborn to its employees. The initiative aligns with the efforts of other companies in the nation addressing the low birthrate issue and fostering a supportive environment for employees to raise children.

Posco is allowing employees with children aged under 9 to choose flexible telecommuting options between whole day (8 hours) or half-day (4 hours). LG Electronics is operating parental leave (2 years) and paid time off for infertility treatment (3 days) beyond legal standards.

BY SEO JI-EUN, BAEK MIN-JEONG [seo.jieun1@joongang.co.kr]