[Edaily Reporter Kim Kook Bae ] A Bank of Korea study has found that despite the semiconductor boom, the quality of youth employment is deteriorating, with one in three young workers employed in temporary or day-labor positions. The study indicates that while young people used to remain unemployed while waiting for stable jobs at large corporations, there has recently been a strong trend toward lowering their expectations and accepting jobs with relatively poor employment conditions.

According to the report “Sluggish Youth Employment and Policy Challenges” (BOK Issue Note) released on the 26th by Hwang Su-bin, Section Chief; Jeong Gang-hee, Researcher; and Jeong Seong-yeop, Team Leader of the Employment Trends Team at the Bank of Korea’s Research Department, the proportion of temporary and daily workers among the youth workforce (ages 15–29) from January to September of this year stood at 32.6%. This is 1.9 percentage points higher than the 30.7% recorded in 2022. During the same period, the proportion of temporary and daily workers among employed individuals aged 30–59 was 12.4%, less than half that of the youth population.

Looking solely at the unemployment rate, the employment crisis among young people is not as severe as in the past. Since 2023, the youth unemployment rate has averaged 6.1%, lower than the 2014–2019 average (9.4%). However, the quality of employment has actually deteriorated. Researchers analyzed that “this appears to be due to a strengthening trend of ‘downward employment’ among young people, where they lower their employment expectations to enter the labor market rather than waiting to enter the primary labor market.”

The reason young people are lowering their employment expectations is that jobs are not increasing sufficiently in the industries that drive economic growth. Although the information technology (IT) manufacturing sector, centered on semiconductors, is showing strong growth, new hires in regular positions have barely increased.

In fact, the average annual contribution of the IT manufacturing sector to economic growth more than doubled, rising from 0.5 percentage points between 2014 and 2019 to 1.1 percentage points from 2023 through the first half of 2026. In contrast, non-IT manufacturing and the service sector—which typically generate significant employment—have underperformed. As a result, the ratio of young people entering regular employment relative to those aged 30–59 is estimated to have fallen by about 15–20% compared to the past. This is due to companies adjusting their workforce by retaining existing employees while reducing new hires.

The spread of artificial intelligence (AI) was also cited as a factor making it difficult for young people to find employment. Analysts note that as some of the entry-level tasks traditionally handled by new hires are being automated by AI, companies are showing a stronger preference for experienced workers over new graduates. Researchers expressed concern that the spread of AI could further reduce young people’s opportunities to enter the labor market.

It has also become more difficult to move to a better job after initially securing employment. According to the Bank of Korea’s research team, the rate at which young people in the secondary labor market moved to the primary labor market (regular employees at private companies with 300 or more employees) the following year is estimated to have fallen from the 8% range in 2014–2019 to the 5% range in 2023–2024. Conversely, the tendency for regular employees at large corporations to remain in their current positions has strengthened. This suggests that the “career ladder”—where individuals build their careers at small and medium-sized enterprises before moving to large corporations—is weakening.

The research team concluded that since the slump in youth employment stems from structural factors—such as changes in industrial structure, the spread of AI, and labor market rigidity—it cannot be resolved by economic recovery alone. The team emphasized, “Job creation policies, which address the labor supply side, have limitations in providing a fundamental solution; a comprehensive approach that combines industrial policy with improvements to the labor market structure is required.”