Hoping for the Right Low Birthrate Policy

The government is pouring enormous fiscal resources and manpower into measures to address low birth rates. Of course, they are having no effect. Most of the diagnoses and prescriptions are misguided, so it is difficult to expect meaningful results. The policy stance must be shifted in the right direction.

Government ministries are obsessed with designing policies to suit their own preferences and securing budgets for them. In effect, they have found a convenient excuse to expand the scope of their organizations. Now is the time to evaluate these measures at the pan-government level, discard the meaningless ones, and consider which policies to focus on.

Low birth rates and population decline are fundamentally different, separate phenomena. If population decline causes social problems, then it should be recognized as a population issue and addressed as such in order to produce clear solutions. Population issues are something advanced countries have already experienced, so the answer as to which policies are effective is already known.

Childbearing is essentially a matter of the individual, not something the government should interfere in. Just as it is wrong to tell people to stop having children because the birth rate is high, it is likewise unnecessary government interference to tell people to have more children because the birth rate is low.

Having children gives meaning to life, and anyone would welcome it with joy. Experts note that stable income is necessary to build a family and raise children. How can stable income be obtained? Naturally, there must be good jobs.

Most good jobs are found at large corporations. The problem is that the share of large corporations in Korea is very low, so unstable jobs and low incomes have failed to improve the stability of people’s lives.

Until the mid-1990s, the share of large corporations was at a level similar to Japan’s. This was about half the level of the United States and the United Kingdom, but because our economy was growing rapidly, jobs were plentiful. As a result, people were confident about the future and did not feel a great burden regarding marriage and childbirth.

The problem arose after the foreign exchange crisis. As the share of large corporations fell by more than half, people’s optimism about the future also rapidly disappeared. The share of large corporations fell to one-quarter of the level seen in advanced countries, and anxiety over jobs continued to rise. Moreover, rigidity increased as a dichotomy between regular and non-regular employment was imposed on jobs at large corporations. A small number benefited, but for most people it meant a loss of opportunity. In a stagnant society where the number of large corporations does not increase, it is difficult to expect the birth rate to rise.

If we want to raise the birth rate, we must allow an environment in our society in which large corporations can increase. Laws and institutions must be established so that businesses and the economy can grow normally, and only then can individuals enrich their lives on the basis of stable income.

Sung-no Choi, President of the Center for Free Enterprise (CFE)

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Original title: 올바른 저출산 대책을 기대한다

Author: Sung-no Choi

Date: 2024-07-12

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=26895