South Korea's Paternity Leave
In a reality check moment recently, South Korea was declared the world's first country likely to disappear due to low birth rates. The birth rate in 2021 was announced at 0.78 per woman. By comparison, aging Japan has a birth rate of 1.3, and the United States is 1.6. Niger, by comparison, the world's highest, has a birth rate of 6.73 children per woman. A sustainable rate is approximately 2.1 children per woman.
In South Korea, a nexus of three inter-related problems has kept the fertility rate so low. Housing costs are rising, there are few openings in the job market, and marriage rates are low and dropping.
The high cost of living hits young people harder than older adults, so they choose to prioritize work and income over starting a family. The decline has continued for 7 years now, and while the government has put more than $200 billion into programs to support new mothers, the fertility rate has continued to drop. The government is deploying the main asset it seems to have, more money, promising to raise the stipend for young children for 300,000 won per month to 1,000,000 won ($230 to $770). The government has also announced plans to increase paid parental leave to 18 months from the current 1 year.
Like many other East Asian nations, South Korea has the majority of its population concentrated in one city; Seoul. This has created a housing crunch, locking out young buyers with high costs. One dramatic symptom of the housing shortage is the rise of jjokbangs, or "divided rooms" which can be as small as 35 square feet or less and only offer enough space to lie down. While jjokbangs are illegal, government actions to curtail their appearance have thus far proved ineffective.
South Korea's paternity leave is the longest in the OECD, but only 22% of fathers use it. Many Scandinavian countries have implemented a "father's quota" system with non-transferrable leave specifically for fathers. This has resulted in 40% of parental leave takers being fathers. By comparison, Japan is even lower at 15.3%.
There are signs that some improvement is happening, with a 30.5% increase in fathers taking parental leave in Korea, but most of this growth has been driven by workers in the public sector, where government employees are required to follow ministry policies.
Gender wage gaps make it difficult for fathers to take time off with their young children. Labor participation by women in South Korea is 53% to male's 72% and women earn wages worth 65.6% of their male counterparts. It is increasingly difficult for single income families to earn enough money to survive, but if they are able to, it is typically the mother who takes a career break. This often means the end of women's earning power, as women who leave the workforce find it difficult to rejoin. Korean women's labor force participation is approximately 75% in their 20s, but drops to near 50% in their 30s and never increases again.
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Large companies have more resources and are better at accommodating things like parental leave, but small and medium sized enterprises account for 82% of employment in South Korea, and they lack the personnel and funds to accommodate employees taking time off.
The Korean government has a difficult job to solve this problem, but perhaps stories like the following might make more parents (including fathers) decided to take time off to be with their young children. As the old joke goes, no one on their death bed has ever said, "I wish I spent more time at the office."
About 10 years ago, when I worked at a large company, I took a year of parental leave. I don't know, but I think it's probably my first time as a man. Luckily, I was promoted on time after returning to work. Yes, it can be scary. You may also be worried about promotion. But there is only one thing I want to say. I wouldn't trade that one year with my daughter for eternity.