In what is being defined as being a part of a demographic shift that risks hobbling South Korea’s economy, the nation’s young residents are likely to have fewer weddings and babies this year than ever before.
Ever since the nation’s statistics office started compiling monthly data in 2000, the first five months of 2016 recorded the lowest levels for the same period in any year related to the number of marriages and births that have been recorded during the aforesaid period.
Despite the South Korean government having poured 80 trillion won ($72 billion) into efforts to reverse the falling birthrate during the last decade or so, the figures underscore the challenge that are faced by the government efforts. The country faces a crisis that threatens to limit long-term economic growth, said the country’s Prime Minister Hwang Kyo Ahn this month.
Getting married or having children is beyond their reach and affordability, say many young South Koreans. One of the biggest obstacles to getting married is the very high cost of housing, they say. Many of the property projects have been priced very high – so high that they have been thrown out of reach of many. This was due to a property boom fueled by the record-low interest rates that were induced to spur economic growth. On the other hand, recording more than double of the national unemployment rate average, the unemployment rate among those 15 to 29 years old is 9.2 percent.
“Previous policies were focused on getting married women to have more babies, but a more fundamental problem could be that young people without jobs are finding it difficult to get married. Youth unemployment is raising the age at which people get married and have their first babies, which can affect the total number of babies they plan to have,” said Yoo Jin Sung, a Seoul-based research fellow at the Korea Economic Research Institute.
Many women are left reluctant to get married and have children as the corporate culture in South Korea makes life challenging for working mothers, women also say.
Hence all the above facts make it very urgent to revise the demographic tide. Two unwelcome milestones are expected to be touched by the country sometime next year. The people who would be aged 65 and older will be more in number than those who would be 14 years and below and that would impact and shrink the workforce in the country. Based on such demographic factors, the Hyundai Research Institute estimates that, from about 2.7 percent at present, the economy’s potential growth rate will fall to 2 percent between 2026 and 2030, if nothing substantial is done by the government in the country to change the anticipated demographic makeup of the population.
The decline is demography is already evident. According to the government’s statistics office, by the year 2030, it is anticipated that the number of women in their 20s and 30s would fall to about 5.5 million at the present rate. The figure in 2010 was 7.3 million.
(Adapted from Bloomberg)