Korea needs nearly 1 million new workers by 2032, report says

Economy

Published: 20 Mar. 2024, 19:09 Updated: 20 Mar. 2024, 19:34

Korea needs nearly 1 million new workers by 2032, report says

Job seekers view at employment notices on a bulletin board at the Seoul Western Employment Welfare Plus Center in Mapo District, western Seoul, on Oct. 27, 2021. [NEWS1]

Korea will begin to see shrinkage in both its workforce and its economically active population in 2028 as a result of its ultralow fertility rate and rapidly aging demographics.

The country will need an additional 900,000 workers by 2032 and maintain an annual growth rate of 1.9 percent to 2.1 percent, according to a report that the Korea Employment Information Service (KEIS) released Tuesday. Failing to procure these workers will restrain Korea's economic development, the report warns.

The working-age population — that is, people over the age of 15 — will increase by just 316,000 between 2022 and 2032, per the report, just one tenth of the increase seen between 2012 and 2022.

The labor force is forecast to increase by 564,000 from 2022 to 2027 and then to decline by 248,000 from 2027 to 2032.

The employed population will reach 28.79 million in 2027 and then lose 28.40 million employees by 2032. That will result in a net increase from 2022 to 2032, but one that is only one tenth of the growth seen in the prior decade.

The number of employees over the age of 15 will also begin to decline in 2028, and that demographic's employment rate is forecast to fall from 62.1 percent in 2022 to 61.3 percent in 2032.

Not only is the overall population shrinking, but the proportion of older adults is also increasing — which will further impact the workforce.

The number of employees in the health and welfare industry is expected to increase by 9.98 million as the aging society bolsters demand for medical services.

The telecommunication industry and the science and technology industry will see increases of 166,000 and 73,000, respectively, due to the spread of digitization.

By contrast, the wholesale and retail industry will lose 407,000 workers, the manufacturing sector 145,000 and construction 126,000 due to the rise of e-commerce, automation technology and EVs.

The number of people providing caregiving and health services will increase by 388,000, while those working in computers and software will grow by 109,000 and nurses by 105,000.

The number of store sales workers, however, will drastically decrease by 249,000, per the report.

The number of laborers in the manufacturing industry will fall by 58,000 and that of vehicle drivers by 52,000.

The report said that the manufacturing, wholesale and retail industry will need a significant amount of additional workers as it is expected to see a downfall in employees in the future.

“The manufacturing, wholesale, and retail industry’s employees are declining alongside the population decrease. Considering this, many more workers are needed for the economy to maintain a normal growth pace,” a KEIS official said.

The KEIS suggested various policies to better help young people, women and older adults to join the workforce.

It advocates the implementation of a widespread support system for young people including high-tech training, customized job support and the offering of work experience.

For female workers, it suggested that corporations expand parental leave and encourage flex time to mitigate the impact of childbirth on parents' careers.

“Customized policy following the changes in industries and occupations is required,” the KEIS said. “Education, nurturing and training policies for industries and occupations, especially those expected to have an increase in workforce demand, are needed as technology progresses.”

“On the other hand, in fields where demand for labor is expected to decrease due to changes in industrial structure, it is necessary to encourage re-employment by reinforcing employment service through training and occupation switch.”

BY NA SANG-HYEON, KIM JI-YE [kim.jiye@joongang.co.kr]