South Korea is experiencing what’s being called an employment ice age.
Young South Koreans are extremely well educated - roughly 70% of those in their 20s and early 30s hold university degrees, but many of them still can’t find jobs. The youth unemployment rate hovers around 10 percent, well above the national average.
And it’s getting worse now that conglomerates like Samsung and LG say they’re not increasing hiring this year.
Smaller companies say they have plenty of jobs. It’s just that no one wants to work for them.
Reporter Jason Strother has more from Seoul.
Most mornings, Lee Seung-hoon takes the subway to Noryangjin, a neighborhood filled with private academies that prepare students for the civil servants exam. His school is located in a 7-story building called the Mega Study Tower.
Public sector jobs are known as the iron rice bowl because even when the economy isn’t so good, the government still hires and it’s very hard to get fired from a job like this.
The country’s new President Moon Jae-in has pledged to create thousands more public service jobs for university grads.
23-year old Lee Seung-hoon is studying engineering, but he says he’s making a pragmatic choice to take time off and study for the civil servant exam.
“It’s not that I think that being a public servant is such a good job, it’s just secure,” he admitted. “Some of my friends want to earn a lot of money, so they’ll try to work for a big conglomerate, but I prefer stability”
Neither engineering nor the civil service is his passion, he tells me.
“Parents want their kids to get a good job, so you have to go to university. It doesn’t even matter what you study you just get into whatever major you can,” he said. “Passion in life doesn’t matter. And so we loose interest in we’re studying along the way”
For most South Korean families, the right kind of job is narrowly defined.
That’s according to Jasper Kim, who teaches at Ewha Women’s University’s Graduate School of International Studies in Seoul.
“Here the right job is a government job or working for one of these large conglomerates. And so what parents do is put all their resources, economic resources, emotional resources into their kids to obtain this goal,” Kim explained.
Other Northeast Asian countries, like Japan and Taiwan have dealt with high youth unemployment rates, too. But Kim argues it’s a bit different here.
Korean parents try to ensure that their kids get the best jobs by not only putting them through university, but also spending lots of money on private education- there’s an academy for almost every profession here.
Kim says it’s not statistically possible for all these well-educated people to land desired positions, and that’s what’s behind Korea’s rising youth unemployment rate.
“Korea is suffering from basically too much education. A class of young kids who have too many degrees, spent too much time in schools.”
Kim continued, “therefore it’s triggered very high expectations, an irrational exuberance of expectations in terms of what type of jobs to expect after graduation.”
Kim says many college grads wouldn’t consider working for a small or medium sized enterprise, SME.
But now that big name firms aren’t creating enough jobs, some young Koreans are giving these smaller companies another look.
I dropped by a youth job fair in Goyang city, just outside of Seoul, where about 50 SMEs were looking to hire on the spot.
Some jobseekers, like 27-year old Choi Kang-min, came here dressed in a suit and tie.
He graduated earlier this year with a degree in automotive engineering and says he’d much rather work for a big company because he’s only heard bad things about small firms.
“I have a friend who works at a small company and he’s always working overtime,” Choi said. “That sounds really bad to me.”
Heo Gun, whose company makes cases for electric wiring, is recruiting at the job fair.
He says SMEs like his have gained an unfair reputation.
“Jobseekers here have this preconception that all SMEs exploit their employees, yes some do, but not all. I wish they can be more open to working for firms like ours,” he told me.
Over-working their employees isn’t the only thing SMEs are known for. They pay a lot less than the big name firms.
That’s why 23-year old Han Yoo-jung says she’s hesitant to work for one.
“My professor says if you work for a conglomerate you’ll earn in one year what it would take10 years to make at a small company.”
But Han adds that given her current job prospects, she’ll take whatever she can get.