Bloomberg
South Korea surpasses population Rubicon with warning to the world
(Bloomberg Markets)-They are called the Sampo Generation: Koreans in their 20s and 30s give up three of life’s traditional rites of passage (Sam): dating, marriage, and having children. I did. They made these choices due to economic constraints and in the process exacerbated South Korea’s vital imbalance. Last year, when the country recorded more deaths than births for the first time in its most recent history, then Deputy Finance Minister Kim Young-bom declared the milestone a “death cross.” Living alone is one of the most popular reality shows in Korea. I am following the life of a movie actor and K-POP singer who are doing common activities such as feeding pets and eating ramen at midnight. People living alone already make up almost 40% of the population. Honbap (meal alone) has been incorporated into everyday language. According to the National Statistics Bureau, there is also a bento brand called Honbap Day. The typical age of a new Korean mother is 32 years. The number of births per woman fell to a record low of 0.84 last year, the lowest rate in the world. The fare for Seoul is 0.64. The United Nations predicts that by 2050, South Korea will have the highest proportion of older people in any country. This vital pressure is slowing down one of the most developed countries in the world. South Korea’s gross domestic product growth was -1% last year, not worse than many countries thanks to the effective containment of the coronavirus, but the average of 2.5% over the last decade is 8% of the labor force was young from 1980 to 2000. Such a busy period will not be recognized by Koreans such as Yang Woo-jin (25 years old) and Kim Yoon-jung (30 years old). “Electronics companies” in and around Seoul have had little success. Yang left the capital and returned to his hometown near the southern port city of Busan, hoping for good luck there. In the case of Kim, she chose not to have one. Children since getting married in 2016. The rising costs of owning a home and raising a family make it harder to think of having children, she says. “It’s impossible for a couple to be both unemployed,” she says. “It seems that the whole Korean society is putting pressure on young people not to have children.” Korea’s predicament is extreme, but not unique. Globally, one in six people will be over 65 by 2050, according to the United Nations Bureau of Economic and Social Affairs. Last year it was 1 in 11 people. Aging is more serious in developed countries. In Canada, Europe and the United States, one in four can be 65 years of age or older, and in Latin America and the Caribbean, one in six can be older. The proportion of people aged 65 and over in South Asia and northern Africa could also double to 1 in 8 and 1 in 9, respectively. Sonal Balma, Chief Economist of India and Asia (excluding Japan) at Nomura Holdings in Singapore, said: “While efforts are being made to raise fertility, countries must at the same time be prepared to address the challenges posed by lower fertility.” South Korea has been doing something about lower fertility for decades. I’ve been trying. Like many other governments around the world, Seoul has provided tens of billions of dollars incentives, from free nurseries to parental leave subsidies. It even arranged a group blind date for civil servants in the hope that it would lead to more marriages. Now, the government has decided to change policy by shifting the focus of policy towards finding a way to live with it, as it reverses the population decline. The new two-track approach seeks to encourage more births to secure a future workforce large enough to maintain the pension system, but will women and older people stay in the workforce? More and more attention is being paid to encouraging new businesses to open. Samsung Electronics Co. Relaxing strict immigration regulations. Companies such as have attracted more foreign workers, including the engineers needed to continue to meet the global greedy demand for computer chips. In January, a government-wide task force on population policy identified 13 key issues to be addressed this year, from addressing the aging manufacturing workforce to helping local cities with a declining population. .. But that’s not easy, and now we have to accept what’s coming and deal with it, “says Treasury official Na Yun-jung, who oversees population policy. “Aging is a global problem, but it’s happening at a tremendous pace in our country. Declining working population weakens our growth base and increases the burden on young people.” It’s not just the size of the workforce. In the past, the system was functioning on the premise that the population of the people would increase steadily throughout Korea. Now they are working on vital changes. According to the South Korean Employment Information Service, almost half of the cities in the country are at risk of a rapid population decline within 30 years, while some universities are already facing a significant decline in enrollment. Population decline is especially relevant to the military. According to the World Bank, the birth rate per woman in North Korea was 1.9 in 2019, while the birth rate in South Korea was 0.9. South Korea has one of the largest military forces in the world, but the number of drafts has declined by nearly a decade. These days, the biggest threat to South Korea’s powerful army of 640,000 is not across national borders, but within its own boundaries. As the population ages, the number of troops is expected to decline by a third within 20 years. The problem is to develop drones capable of transporting ammunition and injured soldiers and fighting on their own, and robots programmed to detect land mines and underground tunnels. At sea, tests are underway on an unmanned mine search vessel. Weapon maker Hanwha Defense believes that robots can reduce the number of personnel required for dangerous operations by as much as 60%. “It makes more sense to kill robots than humans,” says Hanwha’s chief robot developer, Chung Yong Jin. “The lives of individual soldiers are more valuable than ever.” The steps South Korea takes to tackle the vital dilemma are carefully watched by countries in orbit to encounter their own death cross. I will. According to the United Nations, deaths could exceed births in Russia as early as this year. China’s population is expected to peak within 10 years, but it could occur by 2060 in India, the second most populous country after China. Japan’s famous aging problem seems to be more modest than South Korea. Japan was already one of the wealthiest economies in the world by the time the vital clock began to tick, and its key economic conditions and vast domestic savings pool helped the government maintain a high standard of living. I was able to accumulate a huge amount of debt. Economic growth has slowed. South Korea’s challenges and how to deal with them could set a more relevant precedent than Japan for countries at risk of aging before becoming rich, such as China and Thailand. Even if workers join the workforce, South Korea may still be insufficient to close the gap in productivity, labor input and tax base caused by the declining and aging population. Capital Economics Ltd., a London-based consulting firm, says South Korea needs to increase the number of immigrants from its current 3% to a working-age population just to maintain its current workforce. It states. 30% by 2045 — Almost impossible tasks that require a review of immigration law, corporate behavior and social norms. That’s why technology may be the answer, not the influx of immigrants. Self-driving cars that rely on high-speed wireless networks, logic chips used to manipulate artificial intelligence, and automated farms that utilize Internet of Things devices are all part of the government’s technology agenda. In the world, South Korea is in a better position than most others to realize these ideas. “As the population is declining, productivity gains are essential to sustaining economic growth,” said Song Won-sung, an economist at Loyola Marymount University in Los Angeles. “This is an opportunity for South Korea to offset the negative effects of population decline.” It will be too late for many Koreans. When he retired at the age of 59, Kim Jin-hyeon said he was willing to accept low wages if he could find a new job after decades of career at a local bank. Currently, he has shelved his dream of traveling the world and playing golf because he has to pay to raise property taxes and does not want his daughter’s marriage to be delayed someday due to financial difficulties. I will. I’m ready to retire, “says Kim. “Now, life is too uncertain for both my age and the age of my child, unless you are a government-hired civil servant.” Kim covers economics from Seoul. Subscribe now on Bloomberg.com to get the most trusted business news sources. © 2021 Bloomberg LP