Hankyung Research Institute "Severe Labor Shortage in 4th Industrial Revolution Sector... Need for Talent Development"

The number of young people who are unemployed after graduation (or dropping out) reached a record high of 1.66 million as of May this year, while a survey revealed that the 4th Industrial Revolution sector, a future growth engine, is actually experiencing a labor shortage.

This highlights the serious issue of job mismatch in South Korea and points to the need for nurturing talent in preparation for the 4th Industrial Revolution.

According to a survey conducted by the Korea Economic Research Institute targeting policy officers of associations in South Korea's 4th Industrial Revolution sectors on the "Current Status and Prospects of Workforce Competitiveness in Major Countries' 4th Industrial Revolution," it was announced on the 11th that the labor shortage rate in South Korea's 4th Industrial Revolution sector this year is 29.4%.

According to the Korea Economic Research Institute, the major technology fields experiencing labor shortages this year are ▲drones (55%) ▲3D printing (35%) ▲robots (35%), with labor shortage rates exceeding 30%. The labor shortage rate for the 4th Industrial Revolution workforce in 2025, five years from now, is expected to be 28.3%, similar to the current level, with fields such as ▲drones (75%) and ▲robots (55%) expected to see an increase in labor shortage rates compared to now.

South Korea's workforce competitiveness in the 4th Industrial Revolution this year was also found to be lower compared to major countries. Assuming South Korea is 100, the ranking is ▲United States 123.3 ▲Germany 114.4 ▲Japan 107.8 ▲China 106.7, with South Korea trailing the most. In 2025, the ranking is expected to remain the lowest for South Korea, with ▲United States 121.1 ▲China 114.4 ▲Germany 106.7 ▲Japan 104.4.

Current Status of Workforce Competitiveness in the 4th Industrial Revolution Sectors in Korea and Major Countries

Prospects for Workforce Competitiveness in the Fourth Industrial Revolution Sectors of Korea and Major Countries

The top-ranked fields in workforce competitiveness for the 9 foundational technologies of the 4th Industrial Revolution by major countries are: the United States leads in 8 fields except renewable energy; Germany leads in 4 fields (3D printing, renewable energy, advanced materials, computing technology); China leads in 3 fields (blockchain, artificial intelligence, computing technology); and Japan leads in 2 fields (blockchain, advanced materials). South Korea did not lead in any of the compared countries' fields and ranked lowest in 6 out of 9 technology fields, including artificial intelligence.

Therefore, there are calls to enhance workforce competitiveness in the 4th Industrial Revolution. Associations that responded to the survey cited the following measures to improve South Korea's 4th Industrial Revolution workforce competitiveness: ▲expanding major offerings and attracting capable faculty to strengthen educational infrastructure (29.6%) ▲expanding institutional support for technology startup creation and corporate workforce development (22.2%) ▲activating industry-academia-government cooperation (14.8%) ▲creating a flexible work environment and organizational culture to attract talent, such as performance-based rewards and flexible working hours (14.8%) ▲relaxing regulations that hinder technological innovation and new industry creation (14.8%) ▲improving laws, systems, and support for attracting overseas talent (3.7%).

They also pointed out the industry's difficulties in securing workforce as ▲lack of technical personnel suitable for practical work (40.7%) ▲shortage of specialized personnel such as master's and doctoral degree holders (33.3%) ▲lack of government support such as budget support and deregulation (11.1%) ▲rigid working environment and organizational culture such as working hours and seniority-based systems (7.4%) ▲difficulty in paying wages at the level of competing countries (7.4%).

Choo Kwang-ho, Director of Economic Policy at the Korea Economic Research Institute, stated, “Considering the structural decline of the domestic industrial ecosystem due to weakening competitiveness of core industries and lack of new growth engines, preparation for the 4th Industrial Revolution is not a choice but a necessity,” and emphasized, “Since the core element of competitiveness in the 4th Industrial Revolution is human capital, urgent and active efforts are needed to nurture talent, including expanding educational infrastructure.”

This content was produced with the assistance of AI translation services.