The Growing Trend of Young South Koreans Leaving the Workforce
A significant number of young South Koreans are choosing to step away from job searches entirely as the country’s labor market faces ongoing challenges. These difficulties are compounded by a prolonged economic slowdown and increasing global uncertainty. Additionally, protectionist trade policies in the United States under the Trump administration have created further obstacles, leading large employers to scale back on new hires.
The decline in job creation, especially within the manufacturing sector, has limited opportunities for early-career workers. Meanwhile, losses in service-sector roles are also reducing employment prospects. For the second consecutive month, employment in hospitality and food services has contracted, leaving many individuals in their 20s struggling to find work.
According to Statistics Korea, the total number of employed persons in June reached 29.09 million, an increase of 183,000 compared to the previous year. This growth was primarily driven by a 210,000 rise in healthcare and social welfare employment. However, other sectors show a more concerning trend.
Manufacturing, which is the largest source of employment in South Korea, accounting for over 15% of all jobs, lost 83,000 positions from a year earlier. The sector has now experienced a 12-month downturn, marking its longest decline since the 13-month period during the COVID-19 pandemic from March 2020 to March 2021.
Domestic demand remains weak in traditional industries such as textiles and paper, while export-focused sectors like automobiles are facing pressure due to U.S. tariff policies. Construction employment continues to decline, with 97,000 jobs lost in June. This marks the 14th consecutive month of decline, the deepest stretch since May 2024.
The industrial slowdown has had a particularly severe impact on young job seekers. While employment increased by 348,000 for those aged 60 and over, and by 116,000 for people in their 30s, the number of employed individuals aged 15 to 29 fell sharply by 173,000. Job losses were also reported among workers in their 40s and 50s, decreasing by 55,000 and 53,000 respectively.
Kim Sung-hee, a labor economist at Korea University, noted that “youth are steering clear of low-wage, low-skill positions in social welfare, while high-quality jobs in manufacturing—where they might envision a future—are disappearing due to cyclical headwinds.”
Hiring freezes at large companies are exacerbating this trend. S-Oil recently halted recruitment for retail sales positions, citing a deteriorating operating environment. POSCO Future M, a battery materials manufacturer, has opted not to conduct regular graduate hiring this year.
A survey by the Korea Enterprises Federation found that only 60.8% of firms planned to hire new employees in 2025—the lowest figure since the final stages of the pandemic in 2022. At the same time, corporate preferences are shifting away from fresh graduates toward experienced candidates.
A study by CEO Score, which analyzed sustainability reports from 67 of Korea’s top 100 listed companies by revenue, found that the number of employees in their 20s fell from 291,235 in 2022 to 243,737 in 2023—a drop of 47,498 in just two years. The proportion of 20-somethings in the workforce dropped from 24.8% to 21% over the same period.
Cho Won-man, CEO of CEO Score, stated, “In a climate of uncertainty, many companies are scrapping graduate recruitment altogether or moving to ad hoc hiring. The preference for experienced hires is only strengthening.”
Even part-time jobs—traditionally a fallback for students and the underemployed—are becoming harder to find. Hospitality and food service roles, often filled by younger workers, declined again in June, with 38,000 fewer jobs compared to a year ago.
While the overall employment rate edged up by 0.1 percentage point to 63.6% last month, the youth employment rate fell to 45.6%, down one point year-on-year and marking the 14th consecutive monthly decline. A Ministry of Economy and Finance official attributed the drop to job losses in youth-dense sectors such as manufacturing and food services.
As options dwindle, more young people are exiting the labor force altogether. The number of people classified as “taking a break” from both work and job-seeking rose to 2.43 million last month—an increase of 60,000 from a year earlier. Among people in their 20s, that figure reached 396,000, the highest June total since the initial wave of COVID-19 in 2020.
