Chip-led growth, AI erode youth job quality: BOK

Korea's economy faces a concerning trend as it becomes increasingly reliant on semiconductors and artificial intelligence (AI), while the labor market fails to provide adequate job quality for young people, according to the Bank of Korea (BOK). The central bank's latest analysis indicates that the quality of jobs available to individuals aged 15 to 29 has deteriorated significantly, with more young job seekers opting for temporary or daily work instead of seeking regular positions.

The BOK classifies regular employment as the primary labor market and temporary or daily work as the secondary market. Since 2023, there has been a noticeable shift among young people towards the latter category, as they adjust their expectations due to sluggish hiring in the primary market. This trend is attributed to a combination of factors, including changes in the industrial landscape, advancements in AI, and rigid employment arrangements.

One of the key issues identified is the growing mismatch between the sectors driving economic growth and those offering regular employment opportunities. While information technology (IT) manufacturing has emerged as a stronger driver of growth, it is not adequately translating into stable, long-term jobs for young workers. This mismatch in sectors is exacerbating the problem, leaving young people with fewer viable job prospects in the face of an ever-evolving economic landscape.