[Exclusive] OECD's Painful Advice: "Korea Must Eliminate Biases to Respond to Population and Industrial Changes"

OECD Director of Employment, Labour and Social Affairs Meets Korean Ambassador
"Low Parental Leave Usage Among Korean Fathers"
Identifies 'Technical School Prejudice' as Barrier to Green Transition
"Re-education Opportunities Should Be Provided to SME Workers Too"

The Organisation for Economic Co-operation and Development (OECD) has urged that South Korean society must change its prejudices to respond to demographic and industrial changes. It pointed out that the company practice of only women taking parental leave and the perception that vocational high schools are for students who are not good at studying are problematic. It expressed concern that if proper countermeasures are not established amid the rapid transformation of industries due to the green transition, significant damage could occur.

According to the OECD's 'Ambassador-Director of Employment, Labour and Social Affairs Meeting Results' document obtained by Asia Economy on the 27th, Ambassador An Il-hwan of the OECD met with Stefano Scarpetta, Director of Employment, Labour and Social Affairs at the OECD, for a 40-minute conversation at the Korean delegation office in Paris, France, on the 28th of last month. The meeting was held at the request of Ambassador An.

At the meeting, Ambassador An said, "I am interested in the demographic changes and the impact of artificial intelligence (AI) on the labor market that are occurring in many countries," and requested, "I want to gain policy implications on how other advanced countries are preparing."

In response, Director Scarpetta explained, "Much thought is needed to maintain and develop the careers of older workers and women," adding, "Many countries are working on developing related policies." He continued, "South Korea and Japan have generous parental leave systems such as spousal paternity leave, but so far, the usage rate of paternity leave by fathers is not high," and advised, "Going forward, the perception that (men’s) use of parental leave conflicts with commitment to the company must be dispelled."

According to the Ministry of Employment and Labor, last year, the number of men taking parental leave in South Korea was 37,885, accounting for only 28.9% of all parental leave takers. The number of leave days for men was 7.3 months, more than two months shorter than women’s 9.6 months. Although the government states that the number of men taking parental leave has increased, it remains minimal compared to advanced countries. According to the National Assembly Legislative Research Office, in 2020, in South Korea, 21.4 women and 1.3 men per 100 newborns took parental leave annually. The average for 19 countries with comparable statistics was 118.2 women and 43.4 men, higher than South Korea.

‘Revolutionary Change’ as Internal Combustion Engine Cars Disappear... Opportunities for Retraining SME Workers Needed

Voices were also raised about the need to prepare for the decarbonization and green transition of industries. Director Scarpetta explained, "The green transition is expected to have a huge impact on the labor market," and emphasized, "Workers must be prepared for this." Regarding South Korea, he said, "In labor-intensive manufacturing, especially automobile manufacturing, the introduction of electric vehicles is expected to reduce labor demand due to shorter working hours and productivity improvements," and stressed, "It is urgent to transition workers to green jobs through retraining."

Stefano Scarpetta, Director of Employment, Labour and Social Affairs at OECD

However, he pointed out that the disdain for technology and insufficient retraining infrastructure are obstacles. Director Scarpetta said, "In Germany, even if one chooses vocational training and technical education instead of university when deciding a career path, it is easy to obtain quality jobs," and criticized, "In contrast, South Korea must overcome social prejudices against choosing vocational training education." He also advised, "It is important not only to have initial education but also to acquire new skills," and "Especially, small and medium-sized enterprise workers should have many opportunities for retraining."

He predicted that the impact of industrial changes would also be significant. Director Scarpetta warned, "Europe plans to completely eliminate internal combustion engine cars by 2035, which is a change close to a revolution," and cautioned, "Countries manufacturing internal combustion engine vehicles, such as South Korea, may be particularly shocked." He also forecasted, "The development of green industries may raise issues of worker migration."

Meanwhile, discussions were also held on the impact of AI, such as ChatGPT, on the labor market. Director Scarpetta said, "The impact of AI on the labor market has become even greater," and added, "In-depth discussions are needed on how labor demand is changing due to AI development." This will be prominently included in the OECD Employment Outlook report to be published in July.