Korea’s Labor Market Too Small for Its Talent
Korea’s economic policy is failing its talent. As Robert Atkinson and Sejin Kim write in The Korea Times, Korea’s highly educated workforce is increasingly stuck in low-quality jobs. This is not because of a lack of skill, but because of government policies that penalize growth and fragment markets, creating an economy where firm size, not performance, determines success.
At the root of the problem is a pro-small-business stance that protects micro-enterprises at the expense of scale, productivity, and upward mobility. Rather than rewarding consolidation and productivity, Korean policymakers have long treated small firms as untouchable, even when the result is lower wages, less dynamism, and stalled careers.
Just 13.9 percent of Korean jobs are in large enterprises—the lowest share in the OECD and less than half the OECD average. Meanwhile, workers in micro-enterprises earn just 54 percent of what large-firm employees make. This isn’t a minor market distortion. It’s a systematic, policy-driven undervaluation of talent in a country where nearly 70 percent of young adults hold university degrees.
The solution? Atkinson and Kim call for Korea to embrace size neutrality—reforming regulations, incentives, and labor institutions to support firms that innovate, scale, and compete, creating the kind of high-quality jobs Korea’s world-class talent deserves.
