Jon Pareliussen
Economics Department of the OECD
Yoonyoung Yang
Economics Department of the OECD
Hyunjeong Hwang
Economics Department of the OECD
Sunyoung Choi
Korea Institute for Health and Social Affairs
Sunyu Ham
Korea Institute for Health and Social Affairs
Falling fertility is a global phenomenon related to the increasing opportunity cost of motherhood as incomes rise and women gain more equal opportunities in education and the labour market. Rising direct costs of having children, such as housing and education also matter. Effective family policies, a family-friendly working life and more gender-equal sharing of parenting responsibilities making it easier to combine career and family can counteract these trends and increase fertility. In Korea, the direct costs of having children are magnified by fierce competition to enter prestigious universities and high private education expenditures. Most importantly, the opportunity cost of having children is high, as a large gender wage gap compounds norms of mothers as the main carers, while working and caring are difficult to combine in an uncompromising work culture. A dual labour market and largely seniority-based career progression combine to create a very high cost for any temporary absence from the labour market.
Low fertility is a global phenomenon as countries go through their demographic transitions from high birth rates and high mortality rates to low fertility and low mortality. While this was originally seen as the final “steady-state” stage of the demographic transition where the population would stabilise, it has become clear that there is nothing steady and universally predictable about it. Fertility rates differ widely between countries, reflecting economic forces, social norms and intervening policies (Zaidi and Morgan, 2017).
The demographic transition is closely connected to economic development, industrialisation, and widespread access to contraception. New technologies are increasingly skill-intensive, while education has a cost both directly and historically in terms of lost income from child labour. Parents therefore respond to economic development by reducing the number of children while investing more in the human capital of each of them. This is the so-called quantity-quality trade-off. Other factors could reinforce this trend, including the decline in child labour (by law) and a rise in life expectancy, increasing the value of investments in human capital (Delventhal et al., 2021; Galor, 2005; Doepke et al., 2022).
The quantity-quality trade-off literature focuses on household income and treats the married couple as a single decision-making unit. This is also the point of departure for a second major strand of the literature focussing on the trade-offs between fertility and women’s labour force participation and thereby family income. Labour market participation of married women (very few births happened outside of marriage at the time) was low since the onset of the industrial revolution until the beginning of the twentieth century, but then started to rise gradually in most OECD countries in the 1930s and 1940s, and much more rapidly after World War II. This increased the opportunity cost of childrearing in terms of lost family income from women’s employment. It gave rise to a negative relationship between women’s labour force participation and fertility both between countries and within countries, where women who worked full-time usually had fewer children than those not in employment and women who worked part-time fell in between. Likewise, earnings prospects and the opportunity cost of having children are higher for women with higher human capital. Before the 1990s, there was therefore an inverse relationship between female education and fertility both within and between countries (Doepke et al., 2022).
However, the negative cross-country correlation between fertility and female labour force participation observed in most industrialised countries until the 1980s had turned positive by the year 2000 (Doepke et al., 2022; Fluchtmann et al., 2023). The average total fertility rate increased after 1980 in countries with high female labour force participation such as Sweden, Norway, Denmark and the United States, while it declined sharply in low-participation countries such as Italy and Spain between the 1970s and 1990s. From 1990 onward, the average fertility rate in high-participation countries has remained higher than that of low-participation high-income countries. Korea’s experience resembles that of Italy and Spain, but lags in time and the fall in fertility rate has been even more dramatic.
This new pattern does not mean that the quantity-quality trade-off and the opportunity cost of motherhood no longer matter, but rather that other factors intervene to make these trade-offs more or less salient in different high-income societies. This point can be illustrated in a scatterplot of the employment gap between men and women and the total fertility rate (Figure 3.1). Considerable differences exist between countries. Middle-income OECD countries including Turkiÿe, Mexico, Colombia and Costa Rica have relatively high fertility, while a high gender employment gap indicates a trade-off between female employment and fertility in these countries. Some countries, best exemplified by Italy, Greece, Poland and Japan exhibit a somewhat lower, but still high gender employment gap combined with low fertility rates. This implies that there is a trade-off between fertility and female employment, but as incomes are higher in these countries than in Turkiÿe, Mexico, Colombia and Costa Rica, the quantity-quality trade-off and the opportunity cost of motherhood are more salient. A balance is therefore found at higher female employment and lower fertility. Korea shares the qualitative characteristics of this group but is an outlier in terms of its large gender employment gap and very low fertility rate, indicating stark trade-offs between career and motherhood. A cluster of countries exhibit higher fertility rates, combined with a considerably lower gender employment gap. The lowest trade-offs are found in the Nordics and France. Israel, owing to Haredi’s large families and low male employment rate, is an outlier, with very high fertility combined with a low gender employment gap.
2020
Note: This figure is meant for illustration purposes only. Countries towards the bottom and the right experience the least salient trade-offs, while countries towards the top and left experience higher trade-offs.
Source: OECD, Social Protection and Well-being (database).
Factors mitigating the earlier established trade-offs include the expansion of public education, which has reduced the cost to parents of investing in their children’s human capital. Marketisation of childcare (and other home-produced goods and services) has partially converted the time cost of having children into a monetary cost, facilitating female labour force participation especially for high-income families, while public funding of childcare and parental leave can further ease the opportunity cost of parenthood across the earnings distribution (Doepke et al., 2022).
Frictions in the labour market can on the other hand accentuate trade-offs. When unemployment is high, temporary jobs common, and permanent jobs hard to obtain, even a temporary leave to start a family can have long-term repercussions for labour market prospects. Fertility rates may consequently be lower than in a setting where secure, long-term jobs are easier to find (Doepke et al., 2022).
The negative relationship between female education and fertility within countries has also shifted since the 1990s in advanced countries (Hazan and Zoabi, 2015; Bar et al., 2018). For instance, in high-income countries such as the United States, Germany and France, the relationship between education and fertility was negative along the entire education distribution in the 1980s, while fertility has increased at the highest education levels (such as an MA or PhD) since the 2000s. Korea has also moved in this direction in recent years with the fertility rate falling faster among the less educated (KIHASA, 2019). An average 83% of women with a university degree or higher are employed in OECD countries, while only 69% are in Korea (Figure 3.2), where many highly educated women also exit employment upon motherhood.
Analysing households as a single decision-making unit may overlook some important aspects of fertility behaviour. Individuals in high-income countries increasingly value individual self-expression and self-realisation (Inglehart and Welzel, 2005). Individual careers and income prospects also increase in importance as divorces (and break-ups in the case of cohabitation) become more common. In this new reality, it matters to fertility decisions if one person in a couple bears a disproportionate share of the individual career cost of having children. Indeed, Doepke and Kindermann (2019) show that in high-income countries, the mapping from partners’ fertility preferences to outcomes is well described by a veto model: children are likely to be born only if both partners desire to have a baby, implying that a “veto” from one of the potential parents is sufficient to block the decision. Therefore, countries with more gender-equal sharing of domestic work and lower motherhood penalties in the labour market generally have higher fertility. Social norms play an important role in how parents share responsibilities.
2022
Source: OECD (2023a), Education at a Glance 2023.
These various insights help understand why fertility has fallen in Korea despite a considerable strengthening of family policies. The country combines relatively poor performance compared to other OECD countries on several features relevant to fertility. The direct costs of having children (in line with the quantity-quality trade-off hypothesis) are magnified compared to many OECD countries by fierce competition to enter prestigious universities and high private education expenditure. Norms dictating that children should be born within marriage, and that buying a home is a necessary condition to marry may also raise the bar to family formation. The opportunity cost of having children is high due to a dual labour market with unequal pay, working conditions and social insurance coverage, and largely seniority-based career progression combining to create a very high cost for any temporary absence from the labour market (OECD, 2022). A culture of long work hours and a lack of flexibility where work is expected to take priority over family makes it hard to reduce work efforts for a period while children are young, and even the rapid expansion of publicly funded childcare is not sufficient to bridge the demands of a full-time career with having a family (see below). The options available are therefore for many to either remain fully committed to work at the expense of family formation or to temporarily halt working altogether and commit fully to taking care of children and household, with severe long-term career repercussions. This is a choice mostly faced by women, since gender and family norms place the responsibility for childrearing mostly on mothers, and a large gender wage gap makes it rational to forgo the mother’s income instead of the father’s. Women therefore increasingly choose not to marry, not to have babies, or to have fewer babies than in the past, a trend which has given rise to the terms “birth strike” and “marriage strike”. Some men may also object to the expectations to become a breadwinner dedicated to his career that traditionally comes with family formation (Cho et al., 2020).
Having children is a costly affair, as all parents know. Items such as food and clothing make up an ever-decreasing share of outlays in the typical household in OECD countries, while most countries including Korea are increasingly subsidising childcare, lowering the out-of-pocket cost to parents. Housing prices and education costs have on the other hand been on the rise for decades in a number of countries including Korea. In Korea, 41% of unmarried men aged 19 to 34 and 26% of women identify financial constraints as their primary deterrent to getting married. Housing, education and tutoring are expensive. More than half of young people (51.2%) think that they have to own a house to get married, especially in big cities (KRIHS, 2023). The housing price-to-income ratio in metropolitan areas increased from 6.7 in 2012 to 10.1 in 2021 (KOSIS, 2023), making home ownership challenging to achieve for young people. High private education costs is another factor reducing fertility rates. Korea’s private tutoring participation rates are very high, largely reflecting fierce competition to enter prestigious universities. Many parents therefore allocate a significant portion of their income to private tutoring. Meanwhile, the income of young adults has decreased compared to other age groups over the past 10 years, while their debt has increased (Figure 3.3).
Note: Panel A represents a four-quarter moving average for three age groups. Panel B shows debt for individuals under age 40 and for the total population.
Source: OECD Economic Surveys: Korea 2024.
Korea is known worldwide for its emphasis on education, which has played a major role in its economic development. In recent decades, a university degree has become the minimum academic achievement for a majority. More than 80% of teenagers plan to obtain at least a four-year university degree and 90% of parents share that ambition (Jones, 2013). Indeed, nearly three-quarters of high school graduates advanced to college or university in 2021, and the proportion of the 25-34 age group with tertiary education is the highest in the OECD (Figure 3.4). Korea’s extraordinary zeal for education has strengthened credentialism – a reliance on academic qualifications as the best measure of an individual’s intelligence or ability to perform a particular job (OECD, 2022).
Credentialism has led to “education inflation”, which requires job candidates to obtain higher degrees for positions that formerly had lower requirements. This trend is in part reflected in the declining share of students in two-year colleges, traditionally significant providers of vocational education, and a larger share in four-year universities. For example, a two-year college degree in cosmetology faces competition from a four-year university (bachelor) degree in cosmetology (OECD, 2019b).
Education inflation has undermined the value of work experience and diplomas from all but the most prestigious universities (Choi, 2021). Given the dual labour market and a scarcity of quality jobs, graduates from top universities are much more likely to obtain a high salary. Lee and Koh (2023) found that graduates from top-tier universities earn 24.6% more than graduates from bottom-tier universities at the time of labour market entry in Korea, and the wage gap peaks at 50.5% between the ages of 40 and 44. The intense competition to gain admission to these prestigious universities, dubbed “the golden ticket syndrome”, leads many students to prioritise the name of the institution over choosing a field of study according to their interests and skills (OECD, 2022). According to a government survey on factors influencing university choice, 24% of respondents considered university prestige most important, while 32% prioritised aptitude and interest. The survey further suggests that over the past three years, more youth have prioritised prestige, while fewer have prioritised aptitude and interest (MOE and KRIVET, 2023). There is also significant competition to enter medical schools. Doctor pay is high compared to other OECD countries, especially for specialists (OECD, 2023b), and doctors can remain in their career until they reach old age, unlike many other professionals who are typically forced out around the age of 50 due to seniority-based wages and the practice of honorary retirements.
Percentage of the 25-34 age group, 2021
Source: OECD (2021a), Education at a Glance.
Against this backdrop, many Korean parents allocate a sizeable portion of their income to private tutoring, making education expenditure another major hurdle to have children. In 2023, 78.5% of Korean primary and secondary school students participated in private tutoring (Ministry of Education, 2024). The monthly average expenditure for private tutoring per student has increased since 2015, reaching KRW 434 thousand, roughly 10% of average household disposable income in 2023 (Figure 3.5). Empirical analysis suggests that prevalence of private tutoring is negatively associated with a country’s total fertility rate (Anderson, 2018). Indeed, 49.2% of Korean parents think the cost of private tutoring is very burdensome (KEDI, 2022), and 27% point to the burden of their children's education and childcare as one of the main reasons for the falling fertility rate (PCASPP, 2023).
Monthly private education expenditure per student, at constant prices
Note: Private education expenditure has been deflated using CPI.
Source: OECD Economic Surveys: Korea 2024.
This “Golden ticket syndrome”, a situation where almost all students participate in inefficient competition from which only a few emerge as winners is a huge waste for the country. The situation tends to hold back intergenerational social mobility because parents with higher incomes can spend more on private tutoring Figure 3.6, Panel A), and tutoring works in the sense that it is positively correlated with academic achievement (Panel B). However, in terms of net benefits to society, gains in academic achievement are likely outweighed by the cost of provision and negative side-effects, including postponed entry into working life (OECD, 2022). Intensive tutoring has a detrimental effect on adolescent mental health (Xu and Lee, 2023), and Korean youth report low life satisfaction relative to other OECD countries (OECD, 2023f). More than 80% of Korean college students perceive high school as a “life-or-death battlefield”, a significantly higher proportion than in the United States (40%), China (42%) and Japan (14%), countries with relatively comparable entrance exam systems (Kim, 2017).
Efforts to reduce the use of private tutoring have ranged from enhancing the quality of public education to directly regulating private tutoring institutions. Investment in public education has increased to the OECD average, and the number of students per teacher is relatively low (Minea-Pic, 2023). The university entrance exam, the College Scholastic Ability Test (CSAT), has also been reformed to reduce the burden on students, including by removing off-curriculum “killer questions” as of 2023. The government has also directly regulated tutoring centres (hagwons) by recommending them not to offer tutoring ahead of the curriculum from 2014, and banning classes after 10 PM from 2008. Such reforms have so far been unsuccessful, as they did not address the core issues of elite universities and labour market dualism.
Many OECD countries have university entrance systems with low levels of competition and hence little private tutoring. More than half of OECD countries adopt open admissions systems for tertiary education, meaning that there are no restrictions on the number of students accepted into Bachelor's or Master's programmes at universities in general. In Germany, for instance, where public universities are free and unranked, all upper secondary graduates who passed the university entrance exam are secured a seat in the university and the major of their choice except for some popular majors. Introducing a credit transfer system which allows credits taken at one university to be counted towards a qualification studied for at another and facilitating joint degrees as in most European universities (EC, 2024) could also help students pursue their academic interests at various institutions, reducing the emphasis on a few prestigious universities. Investment in higher education is low compared to the OECD and additional investments targeted to selected universities outside of the Seoul metropolitan area, for example in the Regional Innovation System and Education (RISE) programme and Glocal College 30 Project, could help reduce the preference for Seoul-based universities. Relocating some prestigious universities or certain popular departments outside the Seoul metropolitan area is also an option to consider.
Source: OECD Economic Surveys: Korea 2024.
Another way to dampen competition is by lifting some restrictions to supply more of the study places that are in high demand. In the mid-1990s, study places at universities located in non-Seoul metropolitan areas increased due to deregulation, while enrolment caps on universities in the Seoul metropolitan area were maintained. Since then, competition for admission to universities in the Seoul metropolitan area has grown. Han (2022) found that regulated universities within the Seoul metropolitan area tend to be less responsive to student demand. Moreover, the deregulation of student enrolment in non-Seoul metropolitan areas led to a 9 to 10% decrease in participation in private tutoring in those regions (Park et al., 2018). In line with the recommendation of the 2022 Economic Survey of Korea, the Korean government allowed universities to adjust student enrolment across majors from the 2024 school year (Ministry of Education, 2022). The Yoon administration has also taken the initiative to increase the medical school enrolment quota to address doctor shortages and reduce the intensity of competition to enter medical schools. The increase seems to be going ahead despite fierce resistance from the medical profession.
Another way to reduce the money and time spent on private tutoring is to improve the public supply of education services. One issue is opening hours. School ends before 2 PM in the lower primary grades. Until 2024, extracurricular classes were open until 5 PM for first and second-grade students in primary school, shorter than full-time normal working hours for parents. The lack of quality daycare services for young school-age children pushed one in five parents with a primary school child to use private tutoring (Ministry of Education, 2024), and it compelled mothers to exit employment or take parental leave (Choi et al., 2022). The government is rolling out a reform extending extracurricular class hours further to 8 PM (“Neulbom School” programmes) for first-grade primary school students in 2024, second-graders in 2025 and all primary school students in 2026. To ensure its success in competition with private tutoring providers, the reform needs to be implemented with a keen eye on quality.
Strengthening the quality of regular school lessons would also help reduce private education costs. In a recent survey, 50% of parents answered that their children take private tutoring to supplement regular school classes (Ministry of Education, 2024). According to an analysis in Germany, students who received quality individualised and personalised learning during regular classes were less likely to engage in private education (Guill et al., 2020). Similarly, in Scandinavian countries, which seem to have been least affected by the rise of private tutoring, both slow learners and high achievers are entitled to receive education tailored to their needs within the framework of public education (Bray, 2021). Increasing the time teachers spend on preparation and teaching could help teachers to better cater for students' individual learning needs, as Korean teachers spend a higher-than-average proportion of their working time on administrative tasks (OECD, 2024a).
High-quality tutoring lessons delivered digitally for free to students would help ease the inequality of opportunity and financial strain on parents that private tutoring creates. For example, Seoul Metropolitan City runs the “Seoul-Learn” platform, which provides online learning contents from private tutoring institutions to students in vulnerable households. More broadly, digital technologies, including artificial intelligence (AI), could improve the quality of education, increase cost-effectiveness and make education more inclusive by for example personalising education in low-cost ways, and thereby making it accessible to pupils of different means and backgrounds.
A cross-country empirical study found that increases in household expenditure on housing had a significant and negative effect on fertility rates across the OECD (Fluchtmann et al., 2023; OECD, 2024c). In another study, the doubling of housing prices in Korea between 2013 and 2019 was found to reduce the likelihood of people getting married by between 4 and 5.7% (Kang, 2022). The Yoon administration has a target of providing 2.7 million homes nationwide and 1.58 million homes in the Seoul metropolitan area from 2023 to 2027, a 32% increase compared to the addition to housing supply from 2018 to 2022. The strategy involves invigorating private housing supply by simplifying regulations and procedures and direct supply of social housing. However, due to the recent real estate downturn and escalating construction costs, housing starts decreased by 37% nationwide and 56% in Seoul in 2023 compared to the previous year. Given the two- to three-year construction timeline, this implies a considerable reduction in new units available for occupancy in 2025, potentially exerting upward pressure on market prices going forward.
Seoul is one of the most densely populated cities in the OECD (OECD, 2021c). In particular, many parents flock to popular areas such as Gangnam and Seocho, where good schools and high-quality private education providers are concentrated (Jones, 2020). This, along with the increase in single-person households over the past 20 years, has increased demand for housing in Seoul, while supply has not followed suit, resulting in rising prices (BOK, 2021). The housing supply rate in Seoul (the ratio of the total number of housing units to the total number of households) has decreased since 2018, and stood at 93.7% in 2022 (MOLIT, 2024). According to Statistics Korea, the total number of households nationwide is expected to increase until 2039 despite the population decline, due to increasing numbers of single-person households. This means that the supply of housing must steadily increase at least for the next 15 years to improve the balance between supply and demand.
Some regulations hinder private sector involvement, particularly in reconstruction (e.g., rebuilding or repurposing), which is crucial for addressing housing shortages in densely populated Seoul (OECD, 2019d). Since 2006, the Korean government has been collecting 'excess' profits expected from apartment reconstructions. Under the current law, if the average profit per apartment cooperative member of a reconstruction exceeds a certain limit (currently KRW 80 million), the government collects up to 50% of the profit in advance. While the original intent was to promote housing price stability and social equity by reclaiming excess profits, this practice causes financial strain among cooperative members, reducing incentives for residential construction. It could also lead to double taxation, as homeowners are already subject to capital gains tax when selling property.
Presale price caps is another longstanding practice in Korea aimed at stabilising housing prices for privately built new apartments. The Yoon administration lifted presale caps in most areas of Seoul, but they remain in some districts, including popular districts like Gangnam and Seocho which have been at the centre of supply shortages and escalating housing prices. These price caps diminish housing project profitability and keep down both the quantity and quality of housing supply, with the likely long-run effect of housing prices rising even further (Jones, 2020; Yun and Kim, 2014; KDI, 2009).
Social housing is an important source of affordable housing for young people. With increases over the past few years, social housing represents around 8% of the total housing stock, slightly higher than the OECD average (Cournède et al., 2022). However, a significant share of the social housing stock is vacant. From 2009 to 2019, on average, 17 000 public housing units were supplied to newlyweds annually, but only 51% were occupied because the quality, location, and size did not match the needs of newlywed couples (Board of Audit and Inspection, 2021). Despite efforts to enhance the quality and aesthetics of public housing in Korea over the years, these units still generally lag behind private housing, resulting in a persistent stigma attached to public rental housing residents (Woo et al., 2021). This potentially deters some newlyweds from considering these housing options. Additionally, public housing units targeted at newlyweds have predominantly been smaller than 50m², potentially falling short of the desired size. Indeed, smaller-sized public housing has shown a higher non-occupancy rate compared to larger units.
While Korean women in the past may have chosen to leave their jobs when they married and had their first child, many women today are making different choices. The share of dual-income households is on the rise, but the conflict between motherhood and employment remains. What has changed is that when facing a conflict between family formation and work, women increasingly prioritise work. This reflects that women’s earnings have become an important part of family income and likely a shift in women’s labour supply preferences. In this regard, labour market conditions and policies such as work hours, workplace flexibility and job quality and stability affect fertility and female employment by making career and family more or less compatible. Rigid work patterns and long working hours, as in Japan and Korea, may also make family policies less effective than in other countries with shorter work hours and more flexibility as to where and when to work (Sobotka et al., 2019). This is because when individuals are expected to be fully committed to working long and rigid hours, even well-designed and generous family policies may for many not be enough to make it possible to combine career and children. Moreover, the quality and stability of jobs influence fertility decisions as they determine families’ and individuals’ financial security, work-life balance, and overall confidence in their ability to provide for and support a family.
Research shows that among high-income countries, those countries with norms and policies facilitating a combination of career and motherhood achieve both high female employment rates and high birth rates compared to their peers. The female employment rate in Korea has increased over time, but remains, at 61.4% (of the population aged 16-64, in 2023), lower than the 63.2% OECD average (Figure 3.7, Panel A). The employment gap to men is among the highest in the OECD in 2022 (Panel B). The gender wage gap is the largest in the OECD, and the proportion of non-regular workers among women is higher than that among men (Pareliussen, 2022).
Note: Employment rates for 15-64-year-olds.
Source: OECD, Labour Force Statistics (database).
Since the 1980s, the employment of married women increased in urban manufacturing and service industries in Korea (Kang, 2007). Between 1985 and 1990, the labour force participation rate of married women rose from 41.0% to 46.8%, whereas during the same period, the participation rate of unmarried women increased only marginally from 44.7% to 45.6% (Lee, 2012), marking a shift away from the previous practice of selectively employing unmarried women. Both the government and businesses began to recognise the need to utilise the labour force of married women, but public legal and institutional support for pregnancy, childbirth, and childcare was limited. In this situation, where responsibility for childrearing lay with the family, and specifically with women, combining work and childcare was structurally almost impossible. Women therefore tended to participate in the labour force until marriage, after which they exited the labour market. With improved income levels and the spread of middle-class family norms, this reinforced gender-divided roles and responsibilities dictating that women should take care of the home in late 20th-century Korea (Choi and Chang, 2004).
Since 2000, women’s employment rates have been on a continuous upward trend, only interrupted by the credit card crisis in the early 2000s, the Global Financial Crisis in the late 2000s and COVID-19 in 2020-21. The employment rates of women aged 15-64 rose by close to 10 percentage points from 50.1% in 2000 to 61.4% in 2023, while the employment rate of women aged 25-49 rose from 56.3% to 68.3%. Men generally have a higher level of employment than women, and the employment rate of men aged 15-64 has been modestly increasing to reach 76.9% in 2023. The employment rate of men aged 50 and older has increased, while employment of men aged 25-49 has trended down slightly. In 2000, the overall employment rate for women aged 15 and over was 23.8 percentage points lower than that of men. As of 2023, this gap had narrowed to 17.2 percentage points (15.5 percentage points for 15-64 year-olds). (Statistics Korea, 2024a).
A series of studies analysing women's employment in relation to marriage and childbirth from a life-course perspective emphasise that in contrast to the OECD average, women's employment over their lifetime has not significantly deviated from the traditional “M-shaped” pattern (Figure 3.8; Min, 2012; Kim and Park, 2019; Choi and Lee, 2022). It is slightly higher for young women than young men before dropping sharply as a share of women drop out of the labour force to marry and raise children in their 30s. Women’s employment gradually picks up after childrearing age, when they are in their 40s, and drops again in their late 50s as they start to retire. This sequencing of career and family illustrates that career and motherhood are difficult to combine in Korea. According to a government survey, 16% of married women aged 15-54 were currently on a career break due to marriage, family and childcare. Around 41% of them had been away from the labour market for more than 10 years, while 23% had a 5–10-year break. The most typical reason for career breaks was child-rearing (41%), followed by marriage (25%) and pregnancy and childbirth (24%). The career break was most frequent among women aged 35-39 (25%) and the proportion increased with the number and age of children (Statistics Korea, 2024b). Reflecting this, Korean mothers suffer a long-term labour income decrease of about 66%, mainly due to a decline in their labour force participation after childbirth, while fathers are hardly affected (Kim and Hahn, 2022). Cho and Han (2024) pointed out that the narrowing of the gender employment gap from 2013 to 2019 was driven by young women without children, which ironically increased the opportunity cost of childbirth, and estimated that this increase in the child penalty accounted for about 40% of the overall decline in the fertility rate. While there are variations in the degree and nature of this trend depending on the time period, birth cohort quality of employment and other individual differences, the phenomenon has been and remains a steady feature of women’s life course in Korea.
2023
Source: OECD, Labour Force Statistics (database).
Yoo and Lee (2020) found that the employment rate of women who married between 2002 and 2012 dropped by about 12 percentage points in the year of marriage from 82% to 70%, dropped further to 57% after one year and to 45% after six years, a cumulative 37 percentage points drop. Since most women who married in the 2000s had at least one child, the decline in employment after marriage estimated in this study can be understood to include both the effects of marriage and childbirth. Kwak (2020) found that having a first child reduced the probability of a woman being employed by 45% compared to the year before, with the probability of being employed dropping by 17.7 percentage points between two years and one year prior to childbirth.
Kim and Park (2019) created seven categories of life courses and populated them using individual and occupational history data from the Korean Labor and Income Panel Study (2016). According to them, 48.0% of the women could be categorized into either the “M-shaped life” category or the “potentially M-shaped life” category, which means they left their jobs after marriage. This finding indicates that the most typical employment pattern for women across all generations in Korean society is one where they work until marriage (or first childbirth), leave employment thereafter, and then re-enter the labour market after a certain period. Only 8.7% of women were continuously employed both before and after marriage. A significant portion of 17.1% remained in employment while staying unmarried. This study shows that while the share of married women experiencing career interruptions has been decreasing in recent times, life courses that exhibit a balance of work and family remain rare.
Studies measuring changes between birth cohorts reach similar conclusions (Min, 2012; Kim and Park, 2019; Choi and Lee, 2022). Women from the 1970-79 cohort did not show a significant difference compared to women born in the late 1960s in terms of how likely they were to leave employment during periods of childbirth and childrearing (Min, 2012). Women born in the 1970s participated in the labour market more before childbirth compared to women born in the 1960s. However, a greater number of married women in the 1970s cohort withdrew from the labour market immediately after childbirth (Chang and Cheon 2014; Kim 2015; Kim, Park and Shin, 2015). This should be seen in the context of a gradual increase in the age of marriage and childbirth. Women with a higher age at first childbirth were likely to be employed until they had their first child, but were not more likely to stay in employment after childbirth (Min, 2012).
Job quality and stability promote fertility and female labour participation. Alderotti et al. (2021) suggest that employment instability has a non-negligible negative effect on fertility and the effect has become stronger over time. In countries with a dual labour market where jobs are either temporary or for a lifetime such as has long been the case in Spain (see below) and Korea, women tend to postpone childbearing in the hope of landing a stable job first. The quality of part-time employment is particularly important. The possibility of working part-time when children are young, for example by reducing hours in a person’s career job, makes it easier to combine work with parenthood. However, part-time employment will not stimulate fertility if it is of worse quality than full-time employment in terms of job protection, social benefits or hourly earnings (Mcdonald and Belanger, 2016).
Research indicates that a well-calibrated flexicurity approach reduces labour market dualism, making temporary workers feel secure while achieving positive productivity outcomes (Noja and Cristea, 2018; Noja, 2018; Muffels and Wilthagen, 2013). Flexicurity relies on three pillars: freedom to hire and fire (subject to due process), a robust social insurance system ensuring income security in unemployment, and active labour market policies offering workers the opportunity to obtain new skills and look for new jobs in the event that they do lose their job. Several European countries, including the Netherlands and Nordic countries, have adopted variants of this model. For instance, in the early 1980s, the Netherlands adopted flexicurity to reduce unemployment and to enable workers to balance work and life (Becker and Schwartz, 2005). As a result, the Netherlands experienced reduced gender economic disparities, and a drastic decline of unemployment rates, accompanied by a rise of part-time employment (Levy, 1999; Song, 2014). Similar experiences have been observed in other countries, including Denmark and Spain.
Spain’s social partners agreed to a labour market reform in 2021 as a condition to access European funds. The reform aimed at reducing labour market duality and improving the ability of firms to adjust to shocks. The reform reduced the number of contract types to three, restricted the conditions for companies to use temporary contracts, given their extraordinary prevalence, and introduced changes to collective bargaining. Social security contributions were increased for contracts of less than 30 days, and fines on companies abusing fixed-term contracts increased. The reform seems to have been successful in improving working conditions, especially for the young and for women. Following the reform, the number of registered temporary contracts fell sharply, while permanent contracts surged. However, it is too early to conclude that the reform was the cause of these improvements. The 2021 reform comes on top of a number of measures to reduce labour market dualism since the early 1990s, including making employers pay severance to non-regular workers from 2010 (Eichhorst and Marx, 2019; OECD, 2023d) and streamlining dismissal procedures in 2012 (OECD, 2013). These reforms were complemented by strengthening the social safety net, such as expanding coverage of unemployment insurance (e.g., making enrolment of the self-employed compulsory).
Dualism is deeply entrenched in Korea’s labour market, with regular workers in large companies (often referred to as “the primary labour market”) enjoying social insurance coverage, good working conditions and high wages, while non-regular workers (“the secondary labour market”), including part-time employees, face lower wages, reduced access to social insurance, and precarious job conditions. There is a rigid distinction between regular and non-regular workers, with limited opportunities for transitions. Women often quit their regular contracts as a consequence of motherhood, but find that low-paid non-regular jobs are the only options available when they seek to re-enter the workforce. As a result, mothers are three times more likely to be in non-regular employment than fathers. This leads to delayed family formation and fewer children being born (OECD, 2022; OECD, 2021b).
Despite efforts to break down labour market dualism, the share of non-regular workers increased from 32% in 2014 to 37% in 2023 according to Statistics Korea. According to an OECD survey, 61% of 25-54-year-olds reported that the risk of losing their job or income was among their top three worries, as against a 51% OECD average (OECD, 2024c). Chang (2020) analysed how duality in Korea, measured as the risk of job change, has changed across gender and the starting time of first employment for cohorts born in the 1960s, 1970s and 1980s. The results showed that job stability for the 1980s birth cohort improved compared to previous cohorts and that the security of women's jobs notably improved for those in their late twenties and early thirties. However, job stability for those in their early twenties had deteriorated. The gender gap for job stability was greater in the primary labour market than in the secondary labour market and job stability in areas predominantly occupied by women has shown no significant improvement over the past 30 years.
Choi et al. (2020) found that for women in the secondary labour market, the probability of leaving the labour market increased as their children grew older. It began to fall somewhat when the child reached the age of nine or older. The authors observed that the likelihood of women exiting the labour market increases by 15.6% when children are between four and nine years old compared to women without children. For primary labour market workers, no statistically significant difference in employment withdrawal was found compared to childless women for children under nine years of age. However, a 14.3% withdrawal probability was observed when children were over nine years old. In the primary labour market, outside the public sector, even employees with regular contracts (Jeong-gyu-jig) may not have high job security. Additionally, as job responsibilities and workload often increase with higher positions, the time pressure can be higher for older age groups. Furthermore, if the spouses of women are regular workers in senior positions in the primary labour market, this can further strengthen the pressure on women to exit the labour market. In practice, while the long working hours for women in managerial positions did not affect their husbands' career breaks, having a husband who worked long hours was found to increase the likelihood of women in managerial positions leaving their jobs, a finding supported in other research (Cha, 2010). For public sector and large corporation workers, Choi et al.’s (2020) only statistically significant finding was a 10.6% increase in the probability of leaving the labour market for those with children under 3 years old, compared to childless workers.
Other recent studies have corroborated these findings. Oh and Kim (2021) found that the risk of career interruption after marriage is lower for highly educated women and those with higher employment stability. Contrary to Min (2012), Oh and Kim suggested that the risk of career interruption after the first childbirth decreases with age. Jung (2023) conducted a cluster-centred trend analysis of the employment trajectories of women who experienced their first childbirth between 2005 and 2012. The study categorized these trajectories and examined factors affecting employment continuity, finding that women in lower income brackets were more likely to leave employment after having their first child. Maintaining regular employment requires access to various types of caregiving resources, and both caregiving support from family and the use of public childcare were associated with maintaining regular employment.
A root cause of labour market duality is the large productivity gaps among Korean companies, with SME productivity lagging well behind that of large companies and services sector productivity lagging well behind that of manufacturing compared to what is the case in most other OECD countries. A number of policies in place tend to support the survival of low-productivity firms, including subsidy schemes and a scheme for time-limited immigration to low-skilled jobs. Previous OECD Economic Surveys of Korea have recommended a number of reforms to reduce these productivity gaps, focussing on level playing-field competition in the domestic market and increasing openness to in-bound foreign trade and investment (OECD, 2018; OECD 2024b).
However, the most direct and impactful step that could be taken to address this issue would be to relax employment protection for regular workers to reduce the cost and uncertainty of dismissal, while strengthening the social safety net, notably income replacement for the unemployed (OECD, 2022; OECD, 2024b). A survey of 70 employers reports that they hire non-regular workers to ensure labour market flexibility to respond to market fluctuations, thereby avoiding the expenses associated with laying off regular workers (Saram-in, 2021). Employment protection for regular workers is relatively rigid compared to other OECD countries, ranking as the 13th strictest in 2019. Regular workers are strongly protected from dismissal by laws and labour unions, and delays before final court rulings are excessive. Dismissals for economic reasons are strongly regulated, with many procedural hurdles for firms. There must be “an urgent managerial necessity”, a criterion that is ill-defined and difficult to prove in court. Consequently, unpredictable layoff costs compounded by lengthy legal processes, drive up incentives for hiring non-regular workers (OECD, 2022). Simplifying and accelerating the remedial procedure for unfair dismissals, clarifying criteria such as providing more explicit guidance on what constitutes “urgent managerial necessity”, together with increasing the representativeness of unions as discussed below, could improve the situation.
Korean labour unions are relatively strong but unrepresentative of the majority of workers. Only 3% of non-regular workers are labour union members, compared to 20% of regular workers (Statistics Korea, 2024c). The labour unions' predominant focus on the interests of regular employees, especially those in large companies and the public sector, has contributed to the gap in employment protection compared to non-regular workers. The low unionisation rate is also an issue in general, as fragmented and poorly representative social partners are likely to be less inclusive and increase the level of strife (OECD, 2017). Korean unions received grant funding from the central government until 2023, after which union funding was abolished partly due to the lack of transparency in the use of public funds. Before this time, union fees could also be deducted from income taxes, but were pooled with other deductions and subject to a cap on total deductions. In order to increase the representativeness of unions, public funding could increasingly incentivise membership, for example by applying a separate ceiling for tax deductions of union fees, but could also incentivise the membership of non-regular workers more directly.
Another reason for hiring non-regular workers is their low labour costs, stemming partly from their low enrolment rate in social insurance, reflecting both non-compliance with mandatory enrolment and that not all categories of workers are required to enrol. Hiring workers who are not enrolled in social insurance schemes (i.e., national pension, health and employment insurance) lowers employers’ labour costs by about 8-9%. This issue could be mitigated through a stronger monitoring system and labour inspectorate, and integrating social contributions and tax collection. In 2020, Korea outlined a roadmap to achieve full employment insurance coverage by 2025. The original plan was to increase enrolment to 17 million in 2022 and 21 million in 2025. However, as of December 2023, enrolment stood at only around 15.83 million despite some efforts such as expanding employment insurance to platform workers and several occupations such as agency drivers in 2021-22, and easing requirements for employment insurance enrolment in small agriculture and fisheries businesses in 2023. The government plans to integrate social contributions and tax collection as recommended in the 2022 Economic Survey of Korea, which would help increase compliance.
Shorter work hours and flexibility regarding when and where to work make it easier to combine work and family. Weekly work hours differ across the OECD, with the average being around 42 for men, and only Norway and Denmark displaying average weekly work hours below 40. Working hours in Costa Rica, Türkyie, Colombia and Mexico stand out as the longest in the OECD, at just below 50 hours per week. Men work more hours than women in all countries, but the gaps vary considerably in size, with notably small gaps in the Baltics, Hungary, Slovenia and Chile. Korean workers devote more time to paid employment than their peers in most OECD countries, averaging 44.1 hours per week for men and 41.8 hours for women (Figure 3.9, Panel A).
Working very long hours is generally incompatible with participating actively in parenting and family life. The share of workers working very long hours differs considerably between countries, with the ranking of countries very similar to that of average hours. More men than women work long hours in all countries, but the gender gap varies considerably. Gender gaps are also large in countries like the Nordics, the Netherlands and France, generally seen as relatively gender-equal. The Baltics and Hungary stand out with a very low share of both men and women working long hours. A higher proportion of Korean employees, both women and men, work more than 50 hours per week than in most other OECD countries (Figure 3.9, Panel B).
There has been considerable progress in Korea over the past decade, with the average usual weekly hours of full-time workers decreasing by 8.2 hours, reaching 43.2 in 2022. This marks the fastest reduction in work hours among OECD countries, where the average decline over the same period stands at 1.5 hours, but typically from a lower starting point. Korea rolled out a reform reducing the maximum weekly working hours including overtime from 68 to 52 hours in stages from 2018 to 2021. This has improved work-life balance, while initial evidence indicate that hourly productivity increased to fully offset the reduction in work hours (Shim and Kim, 2020). Korea’s statutory 40-hour regular workweek aligns well with most other OECD countries, while the 52-hour cap including 12 hours overtime remains above 48 hours, the statutory limit most commonly observed in OECD countries.
Since the introduction of the 52-hour cap, discussions have been ongoing to increase flexibility in its application by allowing workers to accumulate overtime for extended breaks. Such flexibility could in principle help parents combine work and family if it was balanced between the needs of employers and employees, but in the Korean context there are valid concerns that it would be unbalanced in favour of employers. For example, many Korean workers do not fully utilise their legal annual leave (15 days), with an average annual leave utilisation rate of 76%, due to a number of reasons such as the preference for monetary compensation in exchange for unused annual leave, lack of replacement workers and worries about burdening colleagues (MCST, 2023).
The most direct way policy can influence working hours is by setting minimum labour standards in legislation. The European Union has enforced a regulation capping the workweek at an average of 48 hours over four months since the 1990s. These measures aimed to promote a healthier work-life balance and greater gender equality in terms of working hours and employment prospects, given that men tended to work longer hours than women (Eurofound, 2017). European countries now show relatively minor gender disparities in working hours and wages, with a strong work-life balance as supported by OECD indicators (OECD, 2023c). France reduced the standard weekly working hours from 39 to 35 in the late 1990s (OECD, 2009). Moreover, some OECD countries, including France, Belgium, and Italy, have introduced “right to disconnect” laws, giving employees the right to disconnect from work-related communication outside regular working hours (EU-OSHA, 2023). In France, for instance, the 2013 law requires companies with 50 employees or more to establish a dialogue between employer and employees in order to regulate the use of digital tools beyond working hours, to specify employees’ rights to switch off, and to ensure these rights are enforced (EPRS, 2020). The law is complemented by penalties for non-compliance and provides legal recourse for employees if they believe their rights have been violated. Beyond its legal implications, this legislation has served to heighten public awareness of the right to disconnect.
2023
Note: For Panel B, the dataset contains data on employment by long hour bands (50 and over, 60 and over) for usual weekly hours worked in the main job. Actual hours of work instead of usual hours of work are only available in some countries (Japan and Korea). Data are broken down by professional status – employees, total employment – by sex and age groups.
Source: OECD Labour Force Statistics database.
The United Kingdom provides an example of how legal maximum working hours can influence actual working hours. While the European Union, prior to Brexit, set a 48-hour limit on weekly working hours for employees, only the United Kingdom allowed workers to “opt out”, permitting them to work up to 60 hours per week. This flexibility, designed to accommodate individual preferences, contributed to a prevailing culture of long working hours in the United Kingdom (Barnard et al., 2003). Compared to Western and Northern European countries like France, the Netherlands, Germany, and Denmark, the United Kingdom stands out with long working hours and a high share of workers working long hours (Figure 3.9). This culture, particularly prevalent among white-collar professionals, managers, and full-time regular employees, normalises long hours and may deter employees from choosing reduced working hours or flexible arrangements for fear of career repercussions (Kwon, 2016; Fagan, 2009).
Flexible working arrangements can allow parents to allocate their time use in ways that reduce conflicting demands from work and family. This, in turn, provides greater possibilities for parents to enter or remain in the labour market. Workplace flexibility options span from reduced working hours, flexitime (starting and finishing work at different times without affecting total daily working hours or earnings), and compressed workweek (where the normal workweek is reduced to fewer than five days, but the total number of hours normally worked per week remains the same, typically through extended daily working hours) to more advanced options, such as “time accounts” to spread working hours across weeks or months. Teleworking allows employees to perform their duties from their homes. Numerous empirical studies have highlighted the positive impact of such practices on the successful combination of career and motherhood, as well as on fertility rates (Tonkikh et al., 2019; Rajgelj, 2007). Moreover, increased availability of these arrangements can reduce stress among workers both at home and in the workplace, resulting in lower absenteeism and improved overall productivity (Galinsky et al., 2011). Furthermore, teleworking allows workers to save commuting time, which is particularly significant in Korea where workers spend an average of one hour commuting (in each direction), the longest in the OECD (OECD, 2016).
In most OECD countries, including Korea, parents have the right to use flexible working arrangements, including flexible or reduced working hours and teleworking. For instance, 24 out of 36 countries give workers the right to reduce working hours during their child’s early years, the most common flexible working arrangement in the OECD (OECD, 2019c). Parents reducing their working hours in this way are entitled to earnings compensation in most cases (OECD, 2019c). In Sweden for example, parents with a child under eight can reduce their working hours by 25% and receive proportionate earnings with no loss of social security rights, and may be entitled to receive parental leave benefits as a top-up. Complementing rights to reduced hours, several OECD countries also provide a right to return to full-time work and/or automatically revert to previous hours after a certain specified period (Adema et al., 2020; Blum et al., 2018). Some countries (e.g. Australia, Austria, Norway, Portugal, Slovenia, and Sweden) restrict these rights to parents with young children and/or workers with caring responsibilities, while others, including the Netherlands, New Zealand and the United Kingdom, provide the right to all workers regardless of circumstances (Adema et al., 2020).
In Korea, parents with children aged twelve or younger have the right to reduce their weekly working hours from 52 to a range between 15 and 35. This right can be exercised for up to one year (an additional 24 months for those who did not use parental leave at all). It can be used in separate intervals, with a minimum duration of one month each. Employees have the right to return to full-time work afterwards. When a worker requests a reduction in work hours, the employer must grant it; otherwise, a penalty of up to KRW 5 million (USD 3 735) may be imposed. Additionally, financial support is available to supplement the reduced incomes of employees who choose reduced working hours, equal to 100% of the regular wages ranging from KRW 500 thousand to 2 million per month (USD 374 to 1 495) for the first five hours of reduced work and 80% of the regular wages between KRW 500 thousand and 1.5 million (USD 374 and 1 120) for the remaining hours. To be eligible, two conditions must be met: the worker must be on reduced work hours for a minimum of one month, and must have been enrolled in employment insurance for at least 180 days.
Despite these legal rights, which align well with other OECD countries, the adoption of flexible working arrangements in Korea remains among the lowest in the OECD. In 2015, fewer than 10% of employees used these arrangements, far below the OECD average (Figure 3.10). Although adoption increased to around 16% in 2022, influenced by COVID-19 and government efforts, a survey reveals that over 7.48 million workers, more than double the current users, wish to utilise such arrangements but cannot (Federation of Korean Industries, 2023). Notably, workers in their 30s (58.2%), a key demographic for family formation and fertility, expressed the highest desire to utilise the system. There is also notable mismatch between the preferred types of flexible work arrangements and those actually used in Korea (Statistics Korea, 2022). Presently, among workers utilising flexible work options, the most prevalent are telecommuting and remote work (5.4%), while the least commonly used are compressed workweek (4.6%), flexitime (3.9%), and reduced working hours (1.7%). Conversely, workers who do not currently employ flexible work arrangements express a stronger preference for flexitime (14.6%), compressed workweek (13.6%), and reduced working hours (10.2%).
The share of employees using flexible working time arrangements, aged 15-64, 2015
Note: Flexible working hours refer to the situation of employees who can either fully determine or at least adapt within certain limits their working hours (e.g. flexitime). OECD is the unweighted average of the 28 OECD countries shown in this chart.
Source: OECD Employment Outlook 2021.
Opportunities to access flexible working arrangements vary with firm size. For instance, teleworking is taking place in 51% of Korea’s large companies, compared to only 27% in companies with 5-30 workers (KIHASA, 2022). This matters, as Korean workers spend an average of one hour commuting (in each direction), the longest in the OECD. Flexible work arrangements are more common among men than women (Figure 3.11). This could be because more men work in large corporations or have secure long-term contracts, contexts where flexible work arrangements are used more and more frequently.
Contributing factors to the limited adoption of flexible work arrangements in Korea despite having a similar legal framework to other OECD countries include the lack of a teleworking system and the career disadvantages for those who utilise teleworking options (KIHASA, 2022). This issue is particularly pronounced among non-regular workers, who, despite having equal rights to flexible working arrangements in principle, face additional barriers in practice (OECD, 2024b). If workplace culture and implicit norms continue to endorse extended work hours and presenteeism as the standard, employees may hesitate to use these arrangements due to concerns about potential negative impacts on their income, job security, promotion prospects, and career evaluations. Shin and Lee (2021) interviewed human resource managers at 30 companies where flexible work arrangements were common and found that flexible work arrangements prevent career interruptions for women, increase job satisfaction and improve employees’ ability to concentrate on their work. However, using flexible work arrangements also increased the risk of scoring low on performance evaluation, or made workers anxious about this possibility and made them feel the need to prove themselves.
Source: Statistics Korea. Use of Flexible Work Arrangements by Gender.
The public sector is in general promoting family-friendly and flexible work practices more than the private sector. For example, amendments to civil servant laws now mandate the swift recruitment of replacement staff when a civil servant takes parental leave, even for periods shorter than six months. This initiative has resulted in a replacement worker utilisation rate of 94% currently. Starting from 2018, the recognition of career experience for promotion was increased from one year to three years in line with the full parental leave period, when both parents take parental leave for more than six months each for their first child. There is a lack of data that directly compares the overall parental leave utilisation rate between civil servants and private sector employees, but an empirical analysis suggests that those who worked in the public sector are around four times more likely to perceive parental leave as being accessible (Kim et al., 2021). Furthermore, in 2021, the share of male government officials who used parental leave reached 41.5%, more than doubling from 19% in 2016, and considerably higher than the overall average of 24.1% (average for men and women).
Some private companies have implemented proactive work-family balance policies beyond government requirements, leading to increased productivity and market valuation. A prime example is POSCO, one of the world's largest steel manufacturers. For example, POSCO introduced a "working-from-home for parenting" system, allowing employees with young children to work remotely for either full or half days. In addition to facilitating flexible work arrangements, POSCO provides generous maternity benefits, offering a one-time payment of KRW 2 million (approximately EUR 1 400) for the firstborn and KRW 5 million (approximately EUR 3 500) for the second child on top of the mandatory benefit. After maternity leave, parental leave automatically begins for up to three years without the need for a separate application process or approval from a supervisor. According to POSCO’s own surveys and analysis, these policies have increased employee satisfaction levels and the company's market valuation.
Another example is THEVOO Engineering, an SME engineering company. THEVOO Engineering actively promotes flexible work hours and telecommuting for all employees, and currently over half of the workforce is making use thereof. It introduced a ‘Selective Time Work System’ which allows employees to freely choose working hours. Employees are required to work a minimum of six hours and 30 minutes per day, with the standard workday being eight hours. If they do not fulfil the full eight-hour workday, they have up to three months to make up for the remaining hours. THEVOO put in place software that records all data generated within the company, including PC usage status and activity, as a performance management programme. Since the introduction of the system, the company’s revenue has nearly doubled despite a decrease in the number of staff. The company goes to great lengths to facilitate work for parents, for example by allowing parents to bring their children to work when needed and providing a space where they can study or watch videos. The CEO has ambitions to establish workplace childcare, but the company does not have the necessary scale to realise this ambition on its own.
A norm is defined as something that is usual, typical or a shared standard of acceptable behaviour. These common ideas are products of a country’s historical, religious and cultural heritage, but also shaped by its level of economic development. Norms play a key role in economic development, democracy, governance institutions and gender equality. They are important to fertility, as they affect how society organises working life and caring responsibilities in ways that make work and family formation more or less compatible. They may also steer individual choice in fertility decisions through for example norms towards marrying and having children as a duty, and norms towards the desired number of children.
As outlined in Yang et al. (2024), the demographic and industrial transitions are intricately connected and consequential to understand how fertility, economic growth, values and norms have evolved over time and thereby the policy measures needed to address low fertility (Table 3.1). Industrialisation sharpens the quality-quantity trade-off and the opportunity cost of having children in terms of career sacrifices, while access to education and contraceptives make it drastically easier to limit fertility. Persisting gender-unequal norms may still affect how families and workplaces are organised and may make it difficult to combine motherhood with working and other forms of self-realisation. Throughout the industrial transition and subsequent expansion of the services sector, women’s opportunities in education and employment increase, while norms generally become more gender-equal and focussed on individual self-expression. Together with intervening policies, these factors contribute to shape fertility rates in a low-fertility, low-mortality setting in societies that have completed the demographic transition (Zaidi and Morgan, 2017; Lesthaeghe, 2014).
Note: This table is a rough conceptual representation with no claims to causality.
Source: Author compilation.
Countries with stronger individualistic self-expression values tend to have more gender-equal sharing of childcare responsibilities and to have institutions and working lives better adapted to combining parenthood and work for women and men, although there are considerable differences from country to country (Inglehart and Welzel, 2005). A move towards individualistic values is also associated with increasing divorce rates, re-marriage rates, an increasing share of cohabiting couples, and an increasing plurality of family arrangements in general. The Nordics, Netherlands and New Zealand are the countries most aligned with such values, followed by a number of European and English-speaking non-European countries including Austria, France, Belgium, Germany, Australia, Canada and the United States (World Values Survey, 2023).
If considerable gender inequalities in the career cost following childbirth persist while younger generations increasingly value their individual self-expression and self-realisation, couples will have fewer children, as children are likely to be born only if both partners agree to have a baby (Doepke and Kindermann, 2019). Korea is the country with the weakest self-expression values in the OECD, indicating that priority is given to economic and physical security over self-expression and quality of life. Koreans also typically conform to traditional norms regarding issues such as gender equality, divorce, immigration, homosexuality, cohabitation and sex before marriage (Figure 3.12). Korea’s very rapid economic development along with its Confucian background are likely partial explanations why this is the case. Norms change more between than within generations, and old generations formed their norms in a very different context than today’s modern Korea. Institutions were formed based on older generations’ values and younger generations are subject to expectations from their elders, to an extent forming their actions if not always their beliefs. In terms of fertility, Korea’s position with high economic development and individual freedom coupled with more traditional gender roles implies that women to a large extent have the means to choose alternative paths from the traditional role as mother and carer, while patriarchal norms in family and work life do not necessarily facilitate combining the two.
Sex before marriage justifiable never (1) to always (10)
Source: World Values Survey Wave 7: 2017-2022, www.worldvaluessurvey.org.
Social norms about women’s roles in the home and the workplace affect the sharing of paid work and unpaid caregiving work between men and women and thereby the opportunity cost of motherhood. For example, working mothers are often perceived as bad mothers and mothers face expectations to be children’s primary caregivers in many countries. The share of the population agreeing that a pre-school child suffers with a working mother is higher in Korea than in any other OECD country, slightly above that in China, and notably higher than in the Nordics, New Zealand, the Netherlands, the United States, Japan and Indonesia (Figure 3.13). Younger generations of Koreans have less negative perceptions of the negative effects on children of working mothers than older ones, but more than 50% of 16-24 year-olds agree or strongly agree that a pre-school child suffers with a working mother.
Share of respondents who agree or strongly agree that a pre-school child suffers with a working mother
Note: OECD countries, China and Indonesia.
Source: World Values Survey Wave 7: 2017-2022.
Similar traditional gender norms are reflected in the share of the population agreeing or strongly agreeing that men should have more right to a job than women if jobs are scarce, where more than half of Koreans agree. This is a higher share than in Türkiye, while the share agreeing in Japan is less than half. 5% or less agree in the Nordics, Netherlands, United States, New Zealand and the United Kingdom (Figure 3.14).
Men should have more right to a job than women if jobs are scarce: agree or strongly agree
Source: World Values Survey Wave 7: 2017-2022.
These attitudes are largely reflected in large gender gaps in time spent per day on paid and unpaid work, even though there are some notable differences in country rankings between norms and outcomes. Countries relying heavily on private provision of childcare to a varying degree compensated by transfers and tax credits, such as the United States and the United Kingdom, rank lower on this indicator than what would have been expected solely based on the above-mentioned attitudes. Despite sizeable gaps between genders, Korea ranks better than Japan on this measure. For most countries, the gaps in time spent on paid work are reflected in fairly similar-sized gaps in unpaid work, but there are some notable exceptions including Estonia, Finland, Italy and Lithuania, where the extra time women spend doing unpaid work is far from matched by the extra time men spend on paid work (Figure 3.15).
Korea has the highest educational attainment for women in the OECD, but one of the lowest shares of women managers, and the highest gender employment gap in the OECD (OECD, 2023e). Korea’s gender wage gap is equally the highest in the OECD despite a decline from 37.2% in 2015 to 31.2% in 2022 (Figure 3.16). Empirical studies find that a large share of the gender wage gap is due to gender discrimination, which can be a combination of pure discrimination based on gender (a preference for male workers), and statistical discrimination, the practice that employers invest less in the careers of young women than men, in anticipation that they will leave their job to care for children. Such a gender wage gap likely contributes to gendered role separation among couples during childbearing years, as couples will minimise income loss if the women work fewer hours or leave the labour force altogether. Employment discontinuity of mothers leads to gender disparities in years of service, and re-entering the workforce after a time away puts people at a disadvantage in terms of receiving appropriate wage levels. Employer expectations that women are less likely to work during their childrearing years thereby becomes a self-fulfilling prophecy, reinforcing a vicious cycle of statistical discrimination and employment discontinuity of mothers.
Gender gap, women minus men, 15-64 year-olds
Note: Data for Belgium are for 12+ year-olds; for Greece, 10+ year-olds; for Hungary, 15-74 year olds; and for Sweden, 25-64 year olds.
Reference years vary across countries: Belgium: 2013; Canada: 2015; Estonia: 2009-10; Finland: 2009-10; France: 2009-10; Germany: 2012-13; Greece: 2013; Hungary: 2010; Italy: 2013-14; Japan: 2016; Korea: 2014; Luxembourg: 2013; Mexico: 2014; the Netherlands: 2015-16;
New Zealand: 2009-10; Norway: 2010-11; Poland: 2013; Spain: 2009-10; Sweden: 2010; Turkey: 2014-15; the United Kingdom: 2014-15; the
United States: 2017; and South Africa: 2010.
Source: OECD Gender Data Portal, www.oecd.org/gender/data.
2023 or latest
Note: The gender wage gap is defined as the difference between median earnings of men and women relative to median earnings of men. Data refer to full-time employees on the one hand and to self-employed on the other. Data refer to 2021 for Ireland and to 2022 for Austria, Belgium, Chile, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Israel, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Poland, Portugal, the Slovak Republic, Slovenia, Spain and Switzerland.
Source: OECD, Gender wage gap (indicator). Doi: 10.1787/7cee77aa-en
Despite legal prohibitions against discrimination related to pregnancy, childbirth, and parental leave, one in four women reported feeling discriminated against during job recruitment (24.4%) and in terms of pay (25.1%) (KLI, 2023a). In contrast, only 7.6% of men reported similar experiences of discrimination in these areas. In a survey carried out in 2018, 70% of individuals who utilised parental leave reported facing various disadvantages on their return, notably concerning promotions, exclusion from significant tasks, and discrimination in bonus allocation (KWDI, 2018).
Empirical studies confirm that gender discrimination is a key driver of the Korean gender wage gap, even though observable factors like work hours, sector, firm characteristics and tenure also matter (Choi et al., 2024). This discrimination is generally found in the private sector, while public sector jobs such as government officials and teachers, which have strong legal controls in the hiring process, show almost no gender wage gap (Kim and Oh, 2019).
Yoo (2017) found a large unexplained gender wage gap among two- and four-year college graduates at the time of labour market entry. According to this study, female college graduates earned only 78% of what their male counterparts received upon labour market entry. The contribution of observable human capital to this wage gap was relatively small (7.1%), direct wage discrimination accounted for 32.1%, and 62.1% was attributed to differences in labour market positions such as occupation, industry and company size. Kim and Oh (2019) found that women earn 17.4% less than men in entry-level jobs, despite having identical resumes. Kim (2017) analysed the gender disparities by age and found the gender wage gap in the 15-29 age group was smallest, but the proportion of the gap attributed to unexplained discrimination factors was the largest, at 185.6%. For the over-55s, however, factors including education level, job type, and company size accounted for 55% of the total wage gap. In the 30-54 age group, these factors only explained 30% of the wage gap, with the remaining 70% attributed to unexplained discrimination.
Kim et al. (2021) decomposed the reduction in the gender wage gap between 2002 and 2020 into changes in the composition of explanatory variables, such as the increase in the proportion of women in higher education, high-wage industries, and occupations and changes in the price structure. They found that changes in the composition of explanatory variables accounted for 65% of the reduction in the gender wage gap. On the other hand, the practice of paying women less than men under the same conditions actually increased the wage gap over this period, when seen in isolation.
The issue of statistical discrimination is addressed by Choi and Bang (2018). They identified a gender wage gap of about 10%, even at the early stages of labour market entry. They also found that the wage gap widens significantly for women in their late twenties, for groups both with and without career breaks. This suggests that the increase in the wage gap over time is not a direct effect of career interruption but rather a result of employers acting on their expectation that women will take career breaks.
Rationally behaving employers and employees will tend to cement existing gender gaps, as they will influence the specialisation of roles between spouses during childrearing years and entrench negative expectations and biases about women’s labour market participation. Therefore, the vicious cycle of statistical discrimination cannot be easily resolved without public intervention. Strong legal protections, sanctions and enforcement are key policies in this respect (OECD, 2019c). In Korea, women who have been discriminated against face difficulties in making a case. When a complaint is filed, many cases have been dismissed due to a lack of supporting evidence or resolved only through corrective measures without imposing penalties (KWDI, 2021; Edaily, 2023). While about 55 000 women workers were estimated to have exited their jobs during pregnancy, only 535 workplaces were inspected in 2016 (Kim, 2017). These gaps can result in a climate where workers feel compelled to endure disadvantages, believing that raising concerns may not yield tangible resolutions or protection. Indeed, according to a survey, three out of four workers tolerate gender discrimination mainly due to perceived ineffectiveness in addressing concerns (Human Rights Commission, 2018).
To improve the situation, since 2016, Korea has conducted “Smart Labour Inspections” in workplaces with staff who are pregnant or have given birth, using relevant information from the National Health Insurance Service and Employment Insurance. The number of labour inspectors nearly doubled from 1 538 in 2016 to 3 058 in 2023. The number of inspected workplaces also increased to 1 028 in 2023. The number of reported discrimination cases related to maternity leave increased from 49 in 2016 to 91 in 2023. In 2022, Korea permitted the existing National Labour Relations Commission, comprised of members representing workers, employers, and public interests, to issue corrective orders to employers. These orders include ceasing discriminatory acts or paying appropriate compensation after investigation and interrogation when affected workers apply for remedy. Failure to comply with a corrective order without justifiable grounds may lead to an administrative fine of up to KRW 100 million (EUR 74 000).
Despite increases, labour inspectors are struggling with chronic manpower shortages (KLI, 2023b), resulting in inadequate supervision of many workplaces (KLI, 2024). Employers face fines up to KRW 5 million (EUR 3 470) when found guilty of gender discrimination in hiring, and up to KRW 30 million (EUR 20 800) with up to five years in prison for gender discrimination in promotions. The fine is lower than in some other OECD countries. For instance, the fine is up to EUR 450 000 in the Netherlands or EUR 300 000 in Germany for gender discrimination cases (OECD, 2019c). In Ireland, in cases of discrimination, employees can seek reinstatement to their previous position and claim financial compensation for the preceding six years without any ceiling for any damages suffered due to the discrimination under the Employment Equality Act (IHREC, 2024). Gender discrimination in the workplace may lead to imprisonment in Belgium, for one month to one year (OHRH, 2018). In France, the fine can be up to EUR 225 000, along with imprisonment for up to three years. The Finnish Penal Code prohibits discrimination at work based on sex and several other grounds with penalties varying from a fine to a maximum of two years imprisonment (ILO, 2023).
Pay transparency can also help close the gender wage gap. This not only holds firms accountable for gender disparities but also empowers workers to challenge inequities and generates public pressure for change, prompting employers to take corrective action. Since 2020, businesses have been required to disclose gender wage data through online systems such as Alio and Clean Eye. Korea mandates gender pay reporting, but firms are not requested to provide the detailed information necessary for meaningful analysis and action. Among the 21 OECD countries that mandate gender pay reporting in the private sector, Korea and the United Kingdom are the only ones that request only an aggregate, company-level estimate of the wage gap (OECD, 2023g). In all other countries, more granular information, such as by job category, parental status or seniority, is required for reporting. Furthermore, Korea mandates reporting only for large firms (with a minimum of 500 employees, or 300 or more full-time employees for companies obligated to provide disclosure under Article 14 of the Monopoly Regulation and Fair Trade Act). Moreover, the absence of mandatory equal pay auditing processes, as practiced in many other OECD countries, including Canada, Finland, France and Sweden (OECD, 2023g; Cowper-Coles et al., 2021), further hinders progress in addressing inequalities (OECD, 2023g).
Norms towards cohabitation and divorce are among those that can create hurdles to family formation in Korea. The share of children born to unmarried (usually cohabiting) women has increased across the OECD, and has in recent decades been driven by the higher-educated. More than half of births happen outside of marriage in a number of countries including most Nordics, Chile, France, Mexico and the Netherlands (Figure 3.17). Some countries in notably Latin America have relatively high rates of cohabitation for slightly different reasons, as cohabitation was historically socially accepted as a “poor man’s marriage”. Even so, cohabitation rates have risen considerably also for the higher-educated in many of these countries. There is no clear correlation between the share of children born outside of marriage and total fertility, even though most of the countries with low trade-offs between fertility and female employment also have a higher than average share of children born outside of marriage.
2020 or latest
Note: Data for Australia, Japan, Korea and New Zealand refer to ex-nuptial/out-of-wedlock births, that is, where the child’s parents are not registered as married to each other (or, for New Zealand only, in a civil union with each other) at the time of the birth. For all other countries, data refer to births to mothers where the mother’s marital status at the time of birth was other than married. For Canada, births to mothers whose marital status is other than married as a proportion of births where the mother’s marital status is recorded. In 2018, the mother’s marital status was not recorded on 8% of births. For Mexico, births to mothers whose civil status is other than married as a proportion of births where the mother’s civil status is recorded. In 2018, the mother’s civil status was not recorded on 8% of births. Data refers to 2018 for Belgium, to 2019 for Chile, Estonia, Iceland, Ireland and Israel.
Source: OECD Family Database, www.oecd.org/els/family/database.htm.
Even so, traditional marriage comes with entry- and exit costs, which may be relatively high in Korea. The direct costs of marriage, but also indirect costs are affected by norms. Negative attitudes to divorce imply that the individual locks into a partner with significant exit costs. In many OECD countries, marriage is seen as a milestone in a couple’s relationship without many added expectations from family or wider society compared to cohabitation. In other countries, marriage carries a number of expectations, often rooted in traditional gender stereotypes. In the case of Korea, direct costs include costs for a proposal ceremony, engagement ceremony, the wedding itself, and the cost of purchasing a home, which is seen as a necessary condition to marriage by many. Marriage in Korea is also intricately connected to the expectation of having children, even though younger generations of married couples increasingly see childbearing as optional (OECD, 2024b). Housekeeping, caring for and following up children’s education are largely seen as the mother’s task. The Korean marriage package is therefore for many women a significant step towards motherhood and away from career. It may also imply an expectation to submit to her husband as the head of the household. One illustration of such patriarchal values is that the share of Koreans finding it justifiable for a husband to beat his wife is higher than in most other OECD countries for which data is available (World Values Survey, 2023). Combined with negative attitudes to divorce, this may increase the barriers to family formation compared to countries where cohabitation is more acceptable and divorce less stigmatised.
Marrying and having children have traditionally been seen as duties in Korea, but these norms have been shifting rapidly among young people, who increasingly reject the idea of marriage as a duty (Figure 3.18, Panel A). Unmarried women are much more likely than unmarried men to cite the loss of freedom from having children and the desire to keep their career as important reasons for not wanting children (Panel B). Norms towards having children have also changed among those who chose to get married. The share of married women who see it as their duty to have children fell from almost 80% in 1994 to approximately 30% in 2021 (Panel C), and norms about the expected number of children have also fallen steadily over time (Panel D). The ideal number of children has fallen less, and remains above two for married women.
A typical trait of the male breadwinner-female carer model is that prime-aged men’s labour supply is not very sensitive to their wage level, while married women's labour supply is largely determined by their spouse's income, and is also very sensitive to the level of their own wages. In other words, men will be fully dedicated to work and providing for their families, while women will only work out of necessity or if the financial reward is very convincing. This pattern describes Korea’s past very well (Yoon, 2012b; Chang and Cheon, 2014), but considerable changes took place from the early 2000s to the mid-2010s. Jung (2019) suggests that the elasticity of married women's labour supply in response to their own wages has been decreasing since the early 2000s, falling from 1.98 during 2005-08 to 0.7 during 2013-16. The labour supply elasticity in response to spouses' income also significantly decreased after the financial crisis. Even when categorizing spouses' income into upper, middle and lower classes and calculating the elasticity to wages, the decrease in labour supply elasticity suggests a diminishing influence of wage and income effects on the work decisions of married women. This trend, where women increasingly choose to work regardless of their own and their spouses’ wage levels, points towards a labour supply pattern among married women which is increasingly resembling that of men. This could reflect a change in preferences, but could also be influenced by policies supporting continuous employment for women or by the characteristics of women's jobs. With these caveats, the finding that married women's labour supply is less affected by wages and spouse's income seems to imply that the traditional norm of the man as the main breadwinner and the woman as the main caretaker in couple households is weakening among cohorts who have been in childbearing age in recent years, and that women increasingly base their labour supply decisions on their own work-family preferences. More research is needed to establish this as a fact.
1. Distribution of responses to the question “What do you think about marriage?”, total population over 15 between 1998 and 2006 and since 2008 population over 13.
2. Among people aged 20-44, 2018.
3. Distribution of responses to the question “Do you think you have to have your own child(ren)?”, married women. Data for 1991, 2015 and 2018 cover married women aged 15-49 and 2021 data cover married women aged 19-49. Data for 1994-2012 cover married women aged 15-44. In 1991, “Must have” and “Better to have” are combined. In 2012, husbands could answer on behalf of their wives if their wives were absent when the survey was conducted.
4. Average ideal and expected number of children among married women.
Source: Statistics Korea; National Survey on Fertility, Family Health & Welfare in Korea; Korea Institute for Health and Social Affairs.
Women with education and high labour market status have over time become more attractive as spouses in Korea. This is reflected in the rise of the dual-income family, where women’s income is increasingly an important part of the family economy. The shift in livelihood support in married-couple households from a sole male breadwinner to dual-income support is largely driven by couples in their twenties and thirties (Figure 3.19, Panel A). In 2015, 48.0% of households made up of individuals aged 15-64 had two incomes, meaning both spouses were employed. This increased to 55.7% by 2023. It is noteworthy that after rising considerably since 2015, the share of dual-income couples among those in the childbearing and childrearing ages of 15-29 and 30-39 are no longer significantly different from the average across age groups. Moreover, this appears to be directly related to a rise in the employment rate of married women with children. The percentage of dual-income households with children under 18 increased from 47.2% in 2015 to 56.8% in 2023, with a particularly notable increase for households with children aged 0-6 (Figure 3.19, Panel B). These developments stand apart from the period from the 1990s to the early 2010s, when dual-income households were also on the rise. In this earlier period, the pace of change was slow and gradual (Chang and Cheon, 2014) and largely driven by middle-aged women re-entering the workforce after career interruptions (Kim, 2015).
Note: For Panel B, the Y-axis is the proportion of dual-income households (%) and the X-axis the age range of the youngest child.
Source: Statistics Korea, Local Area Labor Force Survey.
The recent rise in dual-income households seems to indicate that having preschool-aged children does not have as negative an effect on employment as previously. This is supported by Kim (2018), using household survey data. Kim compared the female employment rate for women with children in 2006 and 2016, finding that having children under the age of four or between four and six reduced women’s likelihood of being in employment less severely than in 2006. However, Kim also found that while the effect of having elementary school children was not as great as having children of pre-school age, the negative employment effect of having elementary school-aged children had increased during this period.
Some gender differences remain in terms of how individual income affects fertility. While within-couple fertility increases uniformly with men’s income, the relationship with women’s income is U-shaped. In general, couples with low combined incomes are reluctant to have children. Couples with mid-to-high combined incomes have lower fertility the more total family income depends on the wife’s income, as this increases the opportunity cost of motherhood. This opportunity cost seems to decline as the wife’s income surpasses the median. This could reflect a higher ability to combine work and family for high-income women, for example through a combination of more secure employment status and having the economic means to procure childcare and other domestic services in the market (Choi et al., 2024; Nam and Kim, 2016; Ham, 2020).
Norms do not exist in a vacuum. They are formed as people observe the actions of friends, family, colleagues and other role models like managers in the workplace or public figures. This implies that policies and the political discourse do have roles to play. For example, policies facilitating working for mothers, as discussed in Chapter 4, will make more mothers work, and this will create role models for their children, colleagues and friends. Managers, high-level officials or politicians taking paternal leave will signal that this is indeed acceptable or even desirable. Political parties explicitly targeting gender-balanced representation in elected positions, central and local government can create a signal to other political parties and to society at large that this is desirable. Governments can also affect norms by information campaigns and through the public discourse. The most direct way to seek to move norms is by legislation (or decree), which indeed codifies standards of acceptable behaviour in society.
Strong legal protections, sanctions and enforcement against discrimination and requirements to report and publish related data, for example on gender wage gaps, are likely to affect business practices as mentioned above. Similarly, giving cohabiting parents the same legal rights as married couples would send a signal that cohabitation should be seen as socially acceptable, and thereby lower barriers to family formation. Some OECD countries require cohabiting parents to either marry or register their union if they want their children to benefit from legal protections and rights that resemble those provided for a family with married parents. Civil or registered partnerships exist in two thirds of OECD countries, typically giving equal legal rights to married couples. This right is reserved for same-sex couples in a number of countries, including Czechia, Finland, Germany, Hungary, Italy, Slovenia and the United Kingdom. Moreover, in some countries including Canada, Mexico, Spain, Switzerland and the United States, access to civil partnership registration depends on the region, which has the final responsibility to create such a status (Miho and Thévenon, 2020).
Almost all OECD countries extend certain family rights to “de facto” families with cohabiting partners. This status is obtained by for example living together for a specified length of time, living together and having children together or more subjective criteria, like having “family bonds” or a “stable emotional and economic community”. The rights obtained by these cohabiting families are usually limited compared to those granted to married couples. Generally, countries give parental leave to both parents regardless of marital status, but in some countries these rights are conditional on some criteria, including the duration of cohabitation. Germany, Hungary and Poland require that the leave-taker is the legal parent of the child. De facto cohabitation usually gives weaker inheritance rights and other protections in the event of death of one partner. Belgium, the Czech Republic, Greece, Hungary, Poland, and Portugal do not extend joint property rights equal to those of married couples to cohabiters, Sweden limits this right to a specific type of property, while France, Norway and Italy grant such rights in the case of a cohabitation contract. Finland, the Netherlands, Iceland, and Norway extend such rights if the cohabiter can argue that they contributed to the acquisition of the property. Cohabiting survivors may also have limited rights to survivors’ pensions, and they may have weaker tenant protection compared to married couples. Taxation also differs by the formal status of a couple. For example, some countries, including Australia, the Netherlands, Portugal, Slovenia and Sweden, grant couples who cohabit informally the same tax advantages as married couples. In others, including Belgium and Greece, they are taxed as single persons unless they have a child together. De facto unions may also carry some disadvantages compared to the case where each partner is treated as a single person. Informally cohabiting couples with children from previous relationships are for example less taxed across the OECD if they are taxed as single parents than if they were married or recognised as cohabiting (Miho and Thévenon, 2020).
Under the Korean Civil Code, only relationships arising from marriage between man and woman, blood ties, and adoption are acknowledged as constituting a family. However, Korean courts typically recognise de facto marriage (사실혼) if: the couple has either publicised, announced, or otherwise outwardly shown that their relationship is akin to a marriage; the couple had a formal public wedding ceremony; or the couple lived together like a married couple. This legal recognition gives cohabiting couples legal rights equivalent to those of married couples, except for a couple of areas such as inheritance rights. Consequently, the surviving partner of a cohabiting couple in a de facto marriage risks abruptly losing her or his place of residence if the partner dies, subject to the decisions made by blood-related family members who inherit the property. Although cohabiting partners in a de facto marriage can legally apply for parental leave, obtaining it can be challenging in practice. Mothers may be categorised as single parents once they have a child, because when children are born to cohabiting couples in a de facto marriage, the children are not automatically recognised as having a legal father. The biological father must undergo a legal procedure to establish formal recognition as the father of the child. Same-sex couples experience all the difficulties mentioned above, but in addition they cannot be recognised as legal guardians in medical institutions, limiting their ability to sign consent forms for their partner’s surgery or hospitalisation and they may be ineligible to obtain health insurance as a dependent family member. The share of the population aged 13 and above who find cohabitation without marriage acceptable has increased, reaching 65% in 2022, with the share for young people (aged 19-34) at 81% (Statistics Korea, 2022). Based on this social consensus, further steps towards equal treatment of alternative family constellations could give couples an opportunity to form a family in incremental steps without incurring the immediate costs and expectations attached to marriage (Yang et al., 2024). Cohabiting can also provide at least a short-term financial relief for a couples’ housing burden (KWDI, 2021).
The public sector is a major employer and can directly facilitate a better balance between work and family life for its employees and thereby lead by example. Work practices and policies with high relevance for Korea include the absence of gender discrimination in pay, family-friendly working hours, flexibility of work hours, possibilities to telework and encouraging parental leave for both genders. The public sector has been leading by example over time, with the result that working in government in Korea is attractive relative to the private sector for women who want to balance family and career. Nonetheless, many civil servants remain subject to a punishing working culture with long hours and a lack of flexibility in practice. Civil servants are not defined as employees, and thereby not subject to labour law. The 52-hour work week reform for example does not apply to them, and their rights to participate in strikes or demonstrations are limited. It is quite common in OECD countries that civil servants have employment modalities that differ from minimum standards in labour law. This can affect pay, job security, performance evaluation and access to training, among others (OECD, 2019a). As labour reforms like the 52-hour reform improve the work-life balance in the private sector, the public sector needs to put in additional efforts to continue to lead by example.
A more gender-equal representation in politics creates role-models and is likely to lead to policies more adapted to the needs and interests of both genders, including policies facilitating both women and men combining career and family. Political parties’ nomination process for elected office is a key mechanism to balance gender representation in politics, as illustrated in the case of Norway, where the share of women Members of Parliament increased fairly quickly from below 10% in the 1969 elections to close to 35% in 1985. This steep improvement in female representation was largely attributed to a change in political parties’ nomination processes. When two small parties adopted gender quotas in 1975, this challenged the Labour Party (Norway’s largest party at the time) to increasingly nominate women in winnable spots. From the 1985 election the Labour Party also implemented a gender quota. These quotas were implemented not as a necessary evil, but partly as it was seen as “the right thing to do” as women make up half of the electorate, and partly as it was seen as an important element of a winning political strategy. The adopted quotas put pressure on other parties to increase female representation, and some of the other parties implemented their own quotas later.
254 out of 300 seats in the Korean Parliament are elected from single-seat constituencies, and 46 by proportional representation. Single-seat constituencies may make it harder to increase women’s representation compared to the Norwegian case of proportional representation from each electoral region. In the search for the “best” candidate, the pool of male candidates with distinguished careers is likely larger than that of women in Korea, and gender stereotypes may further favour male candidates. However, there should not be a lack of qualified women in any of Korea’s regions if political parties decided to increase their efforts to secure gender balance.
Norms about how people use formal language in addressing each other is a manifestation of Korean’s relatively strong norms towards deference to authority and the hierarchy, and may contribute to uphold such norms with a number of possible consequences relevant to fertility. For example, it may contribute to long hours, seniority pay and career progression, which contribute to lower fertility as discussed above. Korea’s norm towards polite speech (“honorific language”, or Jondaemal) is almost unique among the OECD membership and tends to mark an individual’s place in the hierarchy following Confucian tradition and military hierarchy culture in a society where men are obliged to serve in the military. Honorific language is used for those who are older or in a higher social position. Those two categories typically coincide, but it can create awkwardness when they do not. In the Korean debate, the link between formal speech and seniority-based careers, hierarchical organization and fear of putting forward ideas or speaking up against superiors is frequently drawn, even though causal evidence of a direct link to honorific language is lacking due to a dearth of research. Ko and Han (2019) showed that hierarchical culture is positively associated with the tendency to keep silent in a company. Kim and Park (2022) also found that the hierarchical culture is negatively correlated with personal performance.
Formal speech conventions exist across the OECD, but have weakened considerably over time and largely disappeared from practical use in a number of OECD countries. Only Japan has a similar tradition of honorifics (keigo). Countries like Germany and France commonly use the formal form in the workplace, when dealing with the authorities, with the elderly or with strangers (vous instead of tu in France, Sie instead of du in Germany, in both countries replaceable with first name in casual speech and Mr/Ms followed by family name in formal form). Spain has similar polite forms (usted instead of tu), but they are less and less frequently used. In a number of OECD countries, including the Nordics, formal form exists, but is seldom used. You was traditionally the formal way to address people in the English language, but is now the universal form with some exceptions like Sir/Madam or royal titles. Norwegian language has a formal form (de instead of du), but formal speech is in practice almost exclusively reserved for addressing members of the royal family.
In most countries, the move towards addressing people more informally and less hierarchically has been gradual and not much influenced by policy. However, the political discourse and role models have played important roles, as illustrated by the so-called du reform in Sweden, popularising the first-person singular du as the universal form of address in Sweden in the late 1960s. Before the reform, formal speech in Sweden had many similarities to Korea today, with a complex and sometimes confusing set of conventions in place to address people correctly. The du reform was not a top-down reform, but rather a gradual evolution, sped up by front-running newspapers and role models. It was seen as a watershed moment when the then head of the National Board of Health and Welfare announced that he would address everyone as du in a speech to his staff in 1967.
Many Korean firms have implemented new naming conventions in attempts to encourage good ideas, promote talent and make decision-making better, nimbler and more horizontal. In CJ Group, employees have been calling each other “sir” instead of using titles since year 2000. Kakao, one of South Korea’s largest Internet companies, decided in 2014 that all employees would go by English nicknames, with many companies in the digital field implementing similar policies. Following initial attempts to introduce horizontal forms of address in 2017, Samsung Electronics recently banned the use of job titles and asked employees to announce their preferred nicknames internally, ranging from English names to initials to their given name (followed by “nim”, which roughly translates to Mr./Ms.).
Ultimately, naming conventions in themselves should not be expected to affect company performance unless they are part of wider changes. Indeed, new naming conventions are perceived as more successful in cases where they were accompanied by efforts to move towards performance-based pay and career progression, and a move towards a more horizontal organisational structure by reducing the number of executive levels. Some companies, for example KT and Hanwha group, reverted to previous naming conventions after a period of time. In these cases, changing names was done in isolation and created a degree of confusion, while potential benefits were not realised as the work structure stayed the same. Others, like online platform Naver, found that reducing the hierarchy to two levels led to blurring of responsibilities, and re-introduced a third level.
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