INTERVIEW | Population Expert Deciphers South Korea's Declining Births

Like Japan, South Korea is grappling with demographic and population challenges. According to the latest figures, the fertility rate in South Korea has dropped to 0.72, the lowest since the nation broke the critical threshold of 2.1 in 1984. The current number, along with 0.68 projected for 2024, is significantly below the replacement fertility rate. In fact, it represents the lowest rate among all Organization for Economic Development and Cooperation (OECD) countries.

How grave is this situation? Imagine a population size of 200 consisting of half male and half female. Assuming 70% of the women give birth to one child over the course of their lifetime, it would add 70 new births. In the following generation, however, that number would shrink to around 25, given the same sex ratio and fertility rate. If around half of them are female, that would be a whopping 88% decrease (from 100 to 12) in the reproductive population in just two generations.

Dr Lee Sang-lim, a population studies expert, warns that South Korea is facing an existential crisis due to these alarming demographic trends. As a principal researcher at the Seoul National University Population Policy Research Center and a civilian advisor to the Parliamentary Task Force on the Population Crisis, Dr Lee brings extensive expertise to the issue.

JAPAN Forward recently engaged with him to gain deeper insights. Excerpts follow.

Current Situation and Factors

How serious is South Korea's situation?

South Korea's declining fertility rate has unfolded in three stages. The first stage emerged around 2002 when the annual number of births fell below 500,000. This decline can be traced back to the economic hardships and restructuring that followed the 1997 Asian financial crisis.

From 2005 to 2015, the second stage saw fluctuating fertility rates, but the trend took a sharper downward turn beginning in 2015. During this third phase, starting in 2015, the number of married couples with children decreased, and so did the fertility rate of newlyweds. Around the same time, the migration of young people from non-Seoul metropolitan areas to urban cities also surged noticeably.

A fertility rate of 0.72 is historically unprecedented. Similar instances occurred when Germany reunified in 1990 — East Germany's fertility rate dipped to 0.77 in 1994. It also occurred during the Great Depression, when fertility rates in major European cities like Vienna fell below 1.00. But those contractions were temporary. What makes South Korea's current situation unique is that this dramatic drop is happening in the absence of a specific economic or security crisis.

What are the main factors contributing to the fertility rate decline since 2015?

In 2015, fertility rates across all age groups suddenly dropped, a phenomenon known as a period effect. Several factors contributed to this decline. One was a steep increase in rental prices when young people found it increasingly difficult to afford a home with their earned income. This challenge was compounded in 2019 when housing prices began to skyrocket.

Policy missteps played a significant role in these developments. Starting in 2010, the government raised the maximum loan amount. It also expanded the availability of rental loans to stimulate the real estate market, inadvertently driving up both housing and rental costs.

In addition to tangible factors, a significant shift in perception emerged among the younger generation around 2010. This period coincides with the widespread adoption of smartphones and the rise of social media.

As young people began comparing their lifestyles and consumption habits with others online, a new form of competition surfaced — one between consumption and procreation. Many have become increasingly materialistic, prioritizing the display of their lifestyles on social media over the traditional path of marriage and family life. The latter is often financially burdensome and less glamorous.

*View of high-rise apartments in Seoul from near the top of Lotte World Tower, the tallest building in South Korea at 555 meters, November 2023.*

Impact on Society and National Security

What consequences can be expected?

First, education and childcare will become increasingly problematic. Many kindergartens and schools in rural areas are already closing, and this trend is expected to intensify over the next decade. Universities across the country are also feeling the impact of declining enrollment.

Local industrial sectors will also face a severe crisis. Domestic industries such as construction, transportation, food and beverage, and accommodation will experience decreased production and a shrinking market.

By the end of the decade, the elderly population will rise, exacerbating issues related to welfare. One thing to note is that population aging will accelerate in tandem with the declining fertility rate, compounding the challenges ahead.

Some experts suggest that immigration could help fill these gaps. Yet it is unlikely to be sufficient to mitigate the population crisis. South Korea's immigration policy is geared toward addressing labor shortages rather than tackling broader population issues. While this approach can alleviate immediate workforce needs, it has its limitations.

The country's shrinking society prioritizes productivity and efficiency. However, most immigrants arriving in South Korea are manual laborers who largely do not contribute to innovation or productivity gains. Therefore, expanding immigration under the current framework could actually exacerbate existing social conflicts.

Could you elaborate on the security implications?

The rapid decline in military personnel poses a significant challenge for South Korea, particularly given the highly structured nature of its armed forces. Each soldier has a specific, tightly organized mission, which becomes increasingly difficult to fulfill as troop numbers dwindle.

Such a situation necessitates a reorganization of the military system. This involves the integration of more advanced and scientific machinery to maintain operational effectiveness. However, this transition comes at a challenging time.

As the elderly population grows, a larger portion of the national budget will need to be allocated to social services, leaving insufficient funds for costly state-of-the-art weaponry. I refer to this as a clash between national security and social security.

If you look at Northeast Asia, the birthrate in China, Japan, North Korea, and even Russia has or is reaching a critical level. In the next 10 to 20 years, the balance of military and security forces in the region will need to be reconfigured to address these demographic realities.

Some argue that a shrinking population might reduce the likelihood of conflict and contribute to regional stability. However, the absence of a recalibrated balance of power could lead to serious security consequences.

Potential Solutions

How do you assess the Yoon Suk-yeol administration's policies?

The Yoon administration is focusing heavily on expanding funding for housing and childcare. However, these policies are primarily aimed at married couples with some assets and stable jobs, overlooking the broader population.

To drive long-term change, deeper structural issues like job market instability, education reform, lowering housing prices, and addressing regional disparities must be addressed. Most importantly, though, a shift in the mindset of the younger generation is crucial to reversing the current demographic trends.

*President Yoon Suk-yeol speaks at the South Korean government's Liberation Day ceremony in Seoul on August 15. (©Yonhap via Kyodo)*

Can Japan serve as a blueprint for South Korea?

Many people look to Japan, which faced declining births and an aging population before Korea. True, Japan experienced population aging earlier than South Korea, but the pace and underlying problems are not the same.

For instance, if you take a look at social surveys, there are notable differences in how social values are evolving in the two countries surrounding family dynamics and gender roles. In South Korea, societal values and perceptions are shifting rapidly, creating a pronounced gap between older and younger generations. It's no exaggeration to say that young and middle-aged populations live in almost entirely different worlds.

In contrast, Japan's social values are changing more gradually, resulting in a less obvious generational gap. This slower pace of change may help explain why Japan's births, while still low, remain more stable compared to South Korea's.

However, this doesn't necessarily mean that young people in Japan are better off than those in South Korea. Japanese youth might have a more solid outlook in economic terms. However, it's difficult to argue that they are better positioned when it comes to gender equality or the influence of generational politics, where the older generation often dictates policymaking.

What is South Korea's model state?

Finding a case similar to South Korea's is difficult, but Germany stands out as a potential model. Under former Chancellor Angela Merkel [2005-2021], Germany implemented a range of policies to address its declining fertility rate. This led to a gradual improvement in the situation.

Germans approached the fertility issue through a "demographic strategy," which recognizes the complex interaction between population dynamics and society. These efforts included labor market reforms, strengthening small and medium-sized enterprises, and introducing various family policies.

In contrast, South Korea's approach focuses mainly on trying to control and manage its population. This strategy is both risky and ineffective. Addressing the declining fertility rate is a challenge that demands the reconciliation of diverse interests, making the role of politics increasingly crucial.

Interview by: Kenji Yoshida