Employment insurance enrollment among workers aged 29 and under fell for the 47th consecutive month in July.
While demographic decline plays a significant role, analysts say a sluggish economy, job mismatches, corporate preference for experienced hires, and the growing adoption of AI and robots are making it increasingly difficult for young workers to enter the labor market. The Ministry of Employment and Labor acknowledged that a swift recovery in youth employment is unlikely.
According to the ministry's labor market trends report based on employment administration statistics for July 2026, released Monday, total employment insurance enrollment stood at 15.877 million last month — up 277,000, or 1.8 percent, from a year earlier. The year-on-year increase has remained in the high 200,000s for seven consecutive months.
Despite the overall gain, the picture was starkly different for young workers. Enrollment among those aged 29 and under fell by 57,000 from a year ago to 2.242 million, extending a streak of consecutive monthly declines that began in September 2022.
Jo Won-sik, head of the ministry's future employment analysis division, said the drop among under-30 enrollees reflects two forces: "Demographic decline among those aged 29 and under accounts for about 60 percent of the decrease, with employment decline accounting for the remaining 40 percent."
That breakdown suggests the recent weakness in youth employment cannot be explained by population trends alone. Jo cited a range of contributing factors beyond a sluggish economy and job mismatches — including companies' shift toward experienced-hire recruitment, the adoption of AI and robots, and workforce adjustments affecting new entrants and fixed-term workers. "Employment for those aged 29 and under is becoming increasingly difficult, and youth employment is unlikely to recover easily," he said.
The decline among young workers was broad-based across industries. Enrollment among under-30s fell by 24,000 in manufacturing, with further drops in information and communications technology (down 15,000), health and welfare (down 13,000), and wholesale and retail (down 9,000).
Other age groups posted gains. Enrollment rose by 85,000 among workers in their 30s, 37,000 among those in their 50s, and 209,000 among those aged 60 and older. Notably, enrollment among workers in their 40s increased by 4,000 — its first gain in 33 months — driven in part by greater participation by women in the workforce.
By sector, services led the overall increase in employment insurance enrollment. Service-sector enrollment reached 11.139 million, up 285,000, or 2.6 percent, from a year earlier. Health and welfare contributed the largest gain at 112,000, followed by accommodation and food services (up 57,000), business services (up 26,000), and professional, scientific and technical services (up 23,000).
Manufacturing enrollment fell by 2,800, or 0.1 percent, to 3.844 million — a 14th consecutive monthly decline. Within the sector, however, employment trends diverged sharply depending on export conditions.
Enrollment in electronics and telecommunications manufacturing, which includes semiconductors, rose by 4,600. Semiconductor workers alone accounted for 6,200 of that gain, driving the subsector's overall increase. Machinery and equipment manufacturing also added 2,300 workers, boosted largely by a 1,900-person rise in special-purpose machinery — a category that includes semiconductor fabrication equipment.
The shipbuilding industry continued to expand its workforce. Enrollment in other transport equipment manufacturing rose by 6,400, or 4.4 percent, from a year earlier, with shipbuilding and boat construction adding 4,800 workers to extend its streak of consecutive monthly gains to 44 months.
On the other side of the ledger, enrollment fell by 3,200 in textile manufacturing, 2,900 in chemicals, and 2,400 in automobiles. The auto sector has been contracting since turning negative in March, with the pace of decline widening. Engine and vehicle assembly shed 2,100 workers, and new parts manufacturing also swung to a decline.
"Some export-oriented industries are doing fine, but the rest are struggling — we are seeing a polarization," Jo said of the manufacturing employment picture.
Construction remained in a prolonged slump. Enrollment in the sector fell by 7,200, or 1.0 percent, to 743,000 — a 36th consecutive monthly decline — with general construction accounting for 7,300 of the drop. The pace of decline has nonetheless been easing gradually: from 9,100 in March to 8,800 in April, 8,400 in May, 8,100 in June and 7,200 last month.
Hiring conditions showed some improvement. New job postings through Goyong24, the government's integrated employment services platform, rose by 13,000, or 7.8 percent, from a year earlier to 177,000. New jobseeker registrations fell by 11,000, or 2.8 percent, to 399,000. As a result, the job-offer ratio — the number of job openings per jobseeker — rose to 0.44 from 0.40 in the same month last year.
New applications for unemployment benefits last month totaled 109,000, down 2,000, or 2.2 percent, from a year earlier, partly because employment centers operated one fewer business day than last year following the designation of Constitution Day as a public holiday this year. Total unemployment benefit payouts came to 1.09 trillion won ($768 million), down 21.8 billion won, or 2.0 percent, from a year earlier.
fact0514@heraldcorp.com
