A society with no newborns, an economy with no new hires

Lee Jeong-dong The author is a professor of the Technology Management, Economics and Policy Program at Seoul National University's College of Engineering. When I sit down with young people, I often hear the same lament: "Where are new workers supposed to gain experience and become experienced workers?" It is as if they are eliminated before they even stand at the starting line. A survey showing that eight out of 10 job seekers cited "a lack of work experience and career development opportunities" as their greatest difficulty reflects this reality exactly. A vicious cycle is trapping an entire generation: They cannot find work because they lack experience, and they cannot gain experience because they cannot find work. Professional occupations are no different. Even after passing the certified public accountant exam, the number of unassigned accountants who have been unable to find institutions for their required training has risen to around 600, and in some years, 70 percent of successful candidates remained unemployed. The scene of people who passed the exam staging a protest in front of the government complex plainly shows how inaccessible the first career step has become. The youth unemployment rate is already nearly twice the level of the overall unemployment rate. A recent analysis by the Bank of Korea confirms this change statistically. Over the three years since the second half of 2022, 211,000 youth jobs disappeared, and 98.6 percent of them vanished from industries highly exposed to AI. During the same period, jobs for people in their 50s increased by 209,000, and 146,000 of those were newly created in industries highly exposed to AI. This means AI is operating in a way that replaces coding, data research and basic analysis that young workers used to handle, while amplifying the tacit knowledge and management work of experienced workers. The central bank calls this "seniority-biased technological change," but put simply, it means that "AI pushes away young hands and gives wings to older shoulders." The calculation for companies becomes simple. Rather than spending money to train inexperienced new workers, it is far more economical to give an AI tool to the experienced workers they already have. But the danger of this calculation belongs not only to society, but also to companies themselves. Becoming better at the work they already do through AI does not guarantee a company's future competitiveness. Companies can survive only by constantly challenging themselves in new fields, and new workers are the seeds that form the most basic foundation of that challenge. Not hiring new workers is ultimately a declaration that a company will protect its current position by working harder in the current way. It is also the act of drying up the soil of long-term competitiveness in exchange for short-term efficiency. Today's efficiency eats away at tomorrow's foundation. The essence of this crisis is speed. The population declines slowly. It takes a generation to recognize the crisis, and another to reverse the trend. By contrast, the collapse of entry-level hiring proceeds quickly and quietly. If companies turn to "experienced workers only" for just one or two hiring seasons, that year's graduates are left with a gap that follows them for life. A gap before the first job is not simply a loss of time. It is a scar that bends the trajectory of lifetime wages and careers. If population decline is a "crisis of total volume," the disappearance of new workers is a "crisis of the entrance." If a society without newborns threatens the existence of a country in the medium to long term, a society without entry-level workers weakens companies, the economy and the community at the same time in the short to medium term. Just as a society that does not have children loses its future, a society that does not hire new workers loses its present. Only the speed is different. Both are issues that change the fate of a nation. There is a strong se...