The progressive policies of South Korean President Moon Jae-in are a threat to his nation’s economy.
Young people in South Korea are suffering most from those policies as youth unemployment continues to rise. With national debt growing at a rapid pace, and a rapidly aging population, there are large concerns over the future of the South Korean economy.
Moon assumed office in 2017 after the impeachment of then-President Park Geun-hye. A known progressive, Moon was elected as part of a movement to remove all traces of Park’s conservative party. Since his election, Moon has been increasingly imposing his policies at an enormous cost to South Koreans.
Moon has lowered
the maximum workweek from 68 hours to 52 hours. His administration
has also significantly increased South Korea’s minimum wage.
The result of those policies is that there are fewer jobs and a reduction in monthly income for many workers. That’s especially true for young South Koreans looking to enter the workforce.
Businesses
are now less willing to hire and have become selective in the hiring process, given
that low-wage employment has become arbitrarily more expensive.
The youth unemployment rate in May was 9.9%, higher than it was two years ago, when Moon was inaugurated. If you include job seekers and part-time employment, the expanded unemployment rate for youth in South Korea jumps to 23%.
Unable to
find work, many students are opting to prolong their education—a cost that
doesn’t always pay off. Some are even looking for jobs abroad in China and
Japan.
The cap on
workable hours and fewer jobs from an increased minimum wage have also led to a
fall in disposable income for the poorest in South Korea,
which includes many young adults.
While recent
reports show that South Korea’s overall unemployment is at a four-year low, that
can be misleading as the reduction in unemployment has primarily come from those
over the age of 64 looking to re-enter the workforce.
Moon’s
policies are only exacerbating an already weak South Korean economy.
Historically,
South Korea is an economy that’s heavily reliant on the export of its
manufactured goods. However, manufacturing jobs (a sector already heavily
staffed by young workers) and production have been on a steady decline since
2017.
Meanwhile, government debt has risen to $596 billion, at a rate faster than any previous administration, due to increased government spending on economic-stimulus efforts. Of course, that debt will eventually have to be paid by today’s youth—who can’t find work—in the form of higher taxes in the future.
That creates
real concerns for the next generation of South Korea’s workforce and the overall
health of the northeast Asian nation’s economy.
The Index of Economic Freedom, an annual report by The Heritage
Foundation, measures the economic freedom of every country based on 12 factors.
A reduction in those freedoms could mean a reduction in South Korea’s economic
prosperity.
While over the past five years, South Korea’s economy has been mostly free, since 2017, there has been a decline in its overall economic-freedom score. According to the report, labor freedom and government integrity in South Korea are seen as mostly unfree. And government spending is becoming more of a problem.
The South
Korean economy is facing great danger due to these illiberal economic policies,
and the nation’s young people are bearing the brunt of it.
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