South Korea's manufacturing sector is facing a deepening crisis as the number of workers in the industry has fallen for seven consecutive months, reaching a 12-year low for January. This decline is attributed to a combination of factors, including the ongoing economic slump, a lack of quality job opportunities, and a growing aversion among young people to manufacturing careers.
According to Statistics Korea, the manufacturing workforce totaled 4,396,000 last month, a decrease of 56,000 from the same period last year and the lowest January figure since 2013. The sector, traditionally a source of stable and well-paying jobs, has been struggling since July 2023, with the economic downturn and weak domestic demand taking a heavy toll.
Even the semiconductor industry, which has seen growth in exports, has not been able to offset the job losses in other manufacturing sectors. The highly automated nature of semiconductor production means that it has a low employment coefficient compared to other industries.
Adding to the problem is the declining interest in manufacturing among young Koreans. The long-term trend shows a steady decrease in manufacturing employment since its peak in 2016. Many young people perceive manufacturing jobs as being less desirable than those in other sectors, leading to a severe labor shortage.
The lack of young workers in manufacturing has resulted in a surge in employment among senior citizens. Last year, workers in their 60s outnumbered those in their 20s in the manufacturing sector for the first time. The average age of manufacturing workers has also been steadily increasing, highlighting the aging workforce.
This mismatch between the jobs available and the preferences of young job seekers has led to a worsening of youth unemployment. The perceived unemployment rate for young people reached a near four-year high last month, raising concerns about the future of the manufacturing sector and the overall economy.
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