The backbone of South Korean society and economy is shaking. People in their 40s who should be leading at work on the strength of experience and passion and financially supporting their children at home are either losing their jobs or are “sandwiched” between those who are younger and older than them.
The job market is extremely grim for them. October saw the overall employment rate reach the highest in 23 years at 61.7 percent with the figures increasing for every age group except for those in the 40s. The employment rate for 40-somethings has been on the decline for four consecutive years since 2015 before it hit the lowest this year. About 436,000 of them lost jobs in the midst of a manufacturing downturn that are forcing manufacturers to restructure or out of business. President Moon Jae-in also said this is “what hurts him the most” at a meeting in October. Born between 1970 and 1979, they have taken the brunt of recent economic crises. When they just entered the job market in their 20s, the 1997 Asian financial crisis broke out, while the global financial crisis dealt a blow to them when most of them started having family in their 30s. Now, they, who are in the 40s, are threatened by layoffs in the car, shipbuilding and shipping industries.
The crisis of 40-somethings is the crisis of the entire society and economy. They are the most productive age group in the workforce, which means a decrease in their employment can reduce the nation’s competitiveness in the mid and long-term. They make up a large portion of demand in the economy as they tend to spend more than any other age groups not least because they have children. If their spending goes down due to job loss, the overall spending will inevitably decline, which will affect the growth.
Despite the seriousness of the matter, the government and the public are too complacent. The government’s job-related programs are mostly tailored for the youth and the elderly. Many election promises are being announced for the younger and older generations ahead of next year’s general elections, but not for those in their 40s. The government needs to come up with measures to create jobs for them before it is too late. In addition, the public and private sectors must join hands to formulate mid and long-term plans that will provide counseling for 40-somethings who are looking for a new job and make manufacturing more competitive.