South Korea's educated classes face manual labour
By Song Jung-a
Published: October 12 2006 03:00 | Last updated: October 12 2006 03:00
Millions of Korean college graduates and highly educated people are struggling to land a decent job. Many of them, exhausted by years of futile searches amid stiff competition, are giving up their dreams and applying for manual jobs.
Stories about the highly-educated forced to become cleaners or to work on production lines, are hitting the headlines in South Korea, the world's 11th largest economy.
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Kim Kwang-sub, a 29-year-old South Korean, spends most of his day studying in a small library to get a job. He has sent resumés to dozens of technology companies since he quit a job at a small telecoms company in March, but none have got back to him.
"It is more difficult than I expected. I have not even had a chance to be interviewed. The school and my grades seem to be the biggest barriers," says Mr Kim, who majored in computer science at a provincial university.
He now regrets his decision to quit the small company he worked for, but he does not want to enter another small outfit. "I want to work for a bigger and more stable company. But I am gradually losing confidence," he says. "Next year, I will turn 30 and it will become more difficult to get an entry-level job, because of the age limit."
This social problem, which South Koreans call "education inflation", has become more serious since the country was hit by the Asian financial crisis, which sparked tough corporate restructuring. The number of college graduates has increased sharply since the 1990s, as the government allowed more colleges to be set up, although the number of jobs allocated for them is limited to just one fourth of the labour market.
It is an irony because the zeal for learning has been a driving force behind South Korea's rapid economic development over the past half century, creating one of the world's most educated workforces. South Korea spends about 7 per cent of its gross domestic product on education, more than any other member of the Organisation for Economic Co-operation and Development. Being accepted at a good university has been considered a ticket to success in this status-conscious country, where people are still judged according to educational background.
But the strong commitment to education is now backfiring. "Before the financial crisis, most of these highly-educated people were absorbed into the job market on the back of the rapid economic growth. But companies are not hiring workers on such a large scale any more amid post-crisis restructuring," says Park Sung-joon, a researcher at the Korea Economic Research Institute (Keri).
According to government data, the number of unemployed graduates hit a record 329,700 in March, this just after college entry levels jumped from 33.2 per cent in 1990 to 81.4 per cent last year. The number of college graduates in excess of the job market's demand over the next 10 years is estimated at 354,000, and that of university graduates and people with a master's degree at more than 194,000, according to the Korea Research Institute for Vocational Education and Training (Krivet). Of all economically able people the proportion that are highly educated is forecast to grow from 31.2 per cent in 2004 to 43.7 per cent in 2015.
Mr Park at Keri says: "This is a failure of government policy, combined with people's excessive passion for education. The mismatch of supply and demand is causing a massive waste of human resources nationally, as the country still needs many manual labourers due to the high portion of the manufacturing sector."
South Korea is still heavily dependent on export industries to drive growth. But these factory jobs do not require such high levels of education and not many university graduates are willing to work on production lines. Consequently, there are constant labour shortages at small and mid-sized manufacturers, while young college graduates suffer from unemployment.
According to a survey by the Korea Chamber of Commerce and Industry (KCCI), 30 per cent of the 1,019 workers who graduated from universities between 2001 and 2006 think their jobs do not require university education and 60 per cent of them said university education has failed to reflect corporate demand.
"It is an urgent social problem that the government should address quickly. If talented [people] are forced to lower expectations and work for less satisfying jobs, it will lower productivity and weaken the overall quality of our workforce," says Park Cheon-soo, a researcher at Krivet.
He stresses the need for national universities to agree to reduce the number of graduates, while reforming college education to make it more practical and geared towards corporate demand.
Despite the pool of university graduates, human resources managers at Korean companies are often dissatisfied with the quality of prospective candidates. "Companies prefer workers who they can use right away, because it takes much time and cost to train them. There are more university graduates but there are not many talents which meet our expectations," says Jun Mu, an HR expert at KCCI.
South Koreans' obsession with education is not likely to ease any time soon. "This is a structural problem that won't be fixed overnight, unless the social perception towards education and jobs changes. It will undermine our national competitiveness if the problem is left as it is now," warns Mr Park at Krivet.
Copyright The Financial Times Limited 2006
