South Korea seeks more foreign labour as workforce ages and dwindles

The Straits Times, 15 Feb 2013

SEOUL - Sharma Sagar is the new face of Korean manufacturing. He is from Nepal.

Mr Sagar studied Korean for years, competing with other candidates in his native Himalayan homeland to be chosen by a joint- government programme that was set up to help South Korea supplement its dwindling labour pool.

"I'm earning a lot here, about 20 to 25 times more than my friends back home," said Mr Sagar, who has been mixing materials to produce vinyl at Homyeong Chemical Industrial.

With one of the world's fastest-ageing populations, South Korea has gone from a country where labour was the only abundant resource to one seeking staff to help run the plants and farms of Asia's fourth-largest economy.

While neighbouring Japan has largely rejected imported labour as a solution to its ageing workforce, South Korea is beginning to accept it.

Immigrants have risen sevenfold since 2000, to 2.8 per cent of the population, and could make up more than 6 per cent by 2030, the government said.

As the won strengthens and the yen weakens, some of South Korea's exporters are increasingly looking to hire abroad to cut costs and remain competitive.

"Our factory can't operate without foreign workers," said director Park Kwang Seo at Homyeong Chemical, which supplies packaging to Coca-Cola and coating films to Samsung Electronics.

"Our business is growing fast and we need to hire more to meet the demand."

Seoul announced steps on Nov 28 to attract more immigrants, including easing visa and citizenship criteria and giving more social support for settlement.

There were 1.45 million foreign residents in South Korea in December, up from 210,249 in 2000, according to the Ministry of Justice. The number will rise to 3.2 million in 2030, said the ministry.

With a birth rate of 1.24 per woman in 2011, South Korea will be short of 2.8 million workers by 2030, according to a Finance Ministry report.

The nation's potential gross domestic product growth would drop to 1.9 per cent by 2031 from a 3.8 per cent average pace during 2011-2020, the report said.

Foreign workers now account for about 3.2 per cent of South Korea's workforce, Statistics Korea said in November after its first survey on the subject. More than half are from China and 47 per cent of the total work in manufacturing.

Most foreign workers do jobs that Koreans no longer want to do.

For higher-level positions, there is still resistance to hiring from overseas, although the need to tap foreign talent will increase.

Part of that resistance comes from a requirement to adapt to Korean values and language, said Mr Anthony Modrich, country manager in Seoul for London-based recruitment agency Robert Walters.

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