Why Experts Say South Korea Shouldn’t Just Waste Money on Its Low Birth Rate Problem

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A social worker looks after a child at Jusarang Community Church in southern Seoul on May 24, 2017. Credit – Jung Yeon-je—AFP/Getty Images

SOuth Korea – a child of the world population decline—has spent $280 billion over the past 18 years to address the low birth rate it recently dropped to a new record-low of 0.72 children per woman over her lifetime. It is due to a combination of factors, but it is often caused by the frustration of young Koreans high cost of living and low life. But even though the government has given money to raise money, experts say that just throwing money away is not the best way to solve the problem.

Since April 2022, the South Korean government has been helping 2 million worth of vouchers were won (about $1,500) for parents who give birth to their first child, with an additional 3 million dollars paid for each additional child. In an effort to provide funding for childcare and foster care, the government has continued to increase funding for families. The monthly income for parents during the first year of a baby also increased in 2024 to 1 million won (about $740) from 700,000 in 2023. And starting in 2018, parents receive 100,000 ($74) per month for each child’s first few years. For a child born in 2024, parents are expected to receive—over eight years—at least 29.6 million, or about $22,000, from the government.

Private companies have joined the campaign to raise the birth rate through financial incentives, and some are offering thousands of dollars for self-promoting workers and tax benefits and other forms of government support for such programs.

“It’s easy to go to fiscal stimulus, to use that tool,” Jisoo Hwang, assistant professor of Economics at Seoul National University, tells TIME. “I think for any government, that has been the easiest solution to the problem of low fertility.”

But Mr. Hwang and other experts tell TIME that while donations help, the best way would be to focus on policies and programs that can solve and improve many of life’s problems. Doing this can lead to them benefiting greatly and without thinking about others can help young people to have a desire to have children and to raise children.

Mr Hwang said policy makers should also consider channeling funds to the public to promote humanitarian projects that benefit a wider group of people. “It would be more effective, instead of just spending more money, if we could invest in public education or public child care, and improve the capacity and availability of these across the country,” he told TIME.

In fact, Seoul is moving along these lines to try to deal with life’s problems. Last week, government eased the burden of new parents looking for a homeand families with children two years of age or younger who are allowed a special housing registration system in which the government allocates pre-sale apartments through a raffle—a method considered to be the best way to buy a home in South Korea, high cost of land, especially in urban areas. And earlier this year, President Yoon Suk-yeol announced that public money after-school care programs will be expanded throughout the country.

Also last week, Yoon oversaw the launch of a high-speed train that will cut travel time between Seoul and its outskirts to less than a quarter of the original journey. Minister of Land Park Sang-woo he told Reuters that the new train was seen as another tool that could improve the number of children born: “For example, having a two-hour journey back home, how can anyone make time to spend time with babies?” The aim is to give people a break after work.”

Hwang said that the Yoon government’s failure to address the problems related to the rising cost of living and family life shows that it is focusing more on the declining birth rate. But there are limits to how much the movement can implement long-term solutions – the most important changes in labor markets and education – the effects of which may not be seen until after.

However, at the same time, policymakers must be careful about introducing non-financial measures that may lead to new problems, said Stuart Gietel-Basten, an author and professor of social science and public policy at the Hong Kong University of Science and Technology. For example, he says, if a new high-speed train makes travel easier, companies can only expect workers to work more in a culture where long working hours are already widespread.

There is also a limit to how many these programs can achieve. Demographers have already warned against that when the fertility rate falls below a certain limit, raising them is more difficult due to self-reinforcing economic and social methods. In South Korea, government officials are predicting that the birth rate will drop, at least for the next two years. a slight increase in 2026 which officials believe will rise, at least slightly, over the next decade. Yonhap He reported in December that Lim Young-il, head of the census bureau, attributed the decades-long decline in South Korea’s birthrate, which he believed to be temporary, to a decline in marriages at the height of the COVID-19 pandemic. Throughout Asia, marriages begin to break down.

This does not mean that continuing to invest in family programs is a waste. “By improving access to childcare, improving access to kindergartens, maternity leave, paternity leave, etc., that has made people’s lives better,” Gietel-Basten told TIME. “It may not have increased fertility. Maybe it will over time. But that’s not it [only] for bringing these kinds of policies. “

contact us to letters@time.com.

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