SOUTH Korea’s birthrate, the lowest in the world, rose in 2024 for the first time in nine years as pandemic-delayed marriages translated into more births.
Government incentives and corporate support for working parents also seem to be making an impact, offering a glimmer of hope for a country struggling with a demographic crisis.
Nam Hyun-jin, 35, who had her second daughter last August, has noticed a societal shift, largely driven by expanded government policies and more companies joining the effort.
“The whole society is encouraging childbirth more than five years ago when we had our first child,” she said.
More crucially, workplace culture is changing.
Nam’s employer, construction firm Booyoung, introduced a 100-million-won childbirth bonus in 2023.
That shift in mindset could prove critical in a nation where women have increasingly prioritised careers over marriage and parenthood due to the soaring cost of housing and raising a child.
The stakes are high: South Korea’s population of 51 million is on track to halve by the end of the century, posing a major risk to economic growth and the welfare system.
Small but significant rise
In 2024, the country’s total fertility rate rose to 0.75 from a record low of 0.72 in 2023 – the first increase since 2015.
While still the lowest in the world, the uptick suggests efforts to reverse the trend may be taking hold.
Government data shows that second- born babies, such as Nam’s, increased by 12% in the latter half of 2024, outpacing an 11% rise in first-born children.
Analysts believe this could indicate more than just a post-pandemic blip.
“There is a high possibility of further rises in fertility rates in the coming years – we are at an inflection point,” said You Hye-mi, presidential secretary for population policy.
Policy overhaul
In 2023, now-impeached President Yoon Suk-yeol proposed a new ministry dedicated to tackling the demographic crisis, aiming for a broader approach beyond cash handouts.
The government has since focused on three key areas: work-life balance, childcare and housing.
It plans to spend 19.7 trillion won (RM60.13bil) on these areas in 2025, a 22% increase from 2024.
The shift away from short-term incentives towards structural reforms has been praised by economists.
“Korea faces some of the world’s most challenging demographics. The government didn’t overstate the case when it declared a national demographic emergency in June,” said Kathleen Oh, Morgan Stanley’s chief economist for Korea and Taiwan.
“The good news is that authorities are moving towards long-term solutions.”
Among the major changes, both parents can now receive 100% of their salary for six months if they take parental leave – double the previous allowance.
The maximum leave period has been extended from one year to 18 months, and paternity leave has been doubled from 10 to 20 days.
The government also fully covers wages for employees at small and medium-sized enterprises (SMEs) during parental leave.
Another policy move requires listed companies to disclose childcare-related statistics in regulatory filings.
SMEs that prioritise childcare support receive additional government incentives.
The role of business
These policies appear to be having an impact.
In 2024, marriages rose at the fastest pace on record, building on a 2023 rebound, the first increase in 12 years.
A government survey showed that 52.5% of South Koreans now have a positive view of marriage – the highest percentage since 2014.
However, policymakers stress that companies must do more.
“The government has prepared as much as it can at an institutional level. Now we need more companies to embrace these policies,” said Shin Kyung-ah, a sociology professor at Hallym University.
Booyoung’s lucrative childbirth bonus sparked a surge in employee births.
Other companies are following suit, with game developer Krafton planning a similar 100-million-won incentive.
The government responded by introducing tax exemptions on childbirth bonuses to encourage more firms to participate.
“After all, companies need this for their own survival,” said Kim Jin-seong, Booyoung’s human resources director. “We build apartments, and they will only sell if enough people live in them.”
A long road ahead
Despite the progress, many younger South Koreans remain sceptical.
“It’s still too expensive and difficult to get married and raise a family in Korea,” said Kim Ha-ram, 21, a university student.
The country aims to raise its fertility rate to 1.0 by 2030 – still well below the 2.1 replacement level needed for a stable population.
One key challenge is temporary employment, which affects 27.3% of South Korea’s workforce, the second-highest rate among OECD nations.
Many of these workers have little job security and are reluctant to start families.
“The gap between permanent and temporary workers is huge. The government needs to create a system that supports everyone,” said Hallym University’s Shin.
Social welfare professor Jung Jae-hoon of Seoul Women’s University agrees, arguing that businesses need to step up.
“Childcare systems are well established through government investment, but we still need companies to create family- friendly work environments,” he said. “Otherwise, the job is only half done.” — Reuters
