Employment Research Institute, Employment Insurance DB Analysis Report
Over 1-Year Employment Retention Rate at 40.1% in 2021
"Careful Policies Needed to Increase Employment Retention Rate"
Among newly employed wage workers, only 4 out of 10 remain at the same workplace after one year of employment.
On the 3rd, the Korea Employment Information Service released a report titled “Analysis of Changes in Employment Retention Rates of Wage Workers for More Than One Year.”
According to the report, the employment retention rate for more than one year among wage workers who newly joined employment insurance was 40.1% as of 2021.
Sarang Jang, a senior researcher at the Korea Employment Information Service, analyzed the employment insurance database from 2012 to the latest data in 2022, examining the annual rates at which newly obtained jobs were maintained until the following year.
The analysis showed that the employment retention rate for more than one year gradually decreased from 42.4% in 2012 to 41.2% in 2017, then rose again to the 42% range in 2018 and 2019.
However, due to the impact of COVID-19, it dropped to 39.6% in 2020 and 40.1% in 2021. In other words, 6 out of 10 workers who newly found jobs in 2021 quit within one year.
According to the Economically Active Population Survey by Statistics Korea, the average length of service for wage workers steadily increased from 64 months in 2012 to 70 months in 2021 and 76 months in 2024.
While the length of service suggests an increase in employment stability, the employment retention rate has remained stagnant or slightly decreased over the past 10 years.
The report pointed out, “This means that although the average length of service increased due to a decrease in the number of newly employed workers and thus a smaller proportion of new hires among all workers, the employment stability of newly employed workers has not relatively improved compared to the overall average of all workers.”
Researcher Jang stated, “This reflects a dual labor market where stable jobs have strengthened stability, while relatively unstable jobs have not.”
By gender, as of 2021, the employment retention rate for more than one year was 42.4% for men and 37.9% for women. By age group, those in their 30s (46.0%) and 40s (43.8%) had higher rates, while those aged 60 and over (34.0%) and under 29 (37.4%) had relatively lower rates.
Additionally, the lower the educational attainment, the lower the employment retention rate. The report explained, “During the period when employment retention rates declined after COVID-19, the decrease was more pronounced among women than men, and overall, gaps by gender, age, and education widened over the past 10 years.”
Researcher Jang added, “During periods when employment indicators worsen, detailed policies are needed to support groups with low employment retention rates,” and “It is necessary to further examine the causes of changes in employment retention rates from the labor demand side, such as industrial factors.”
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