Increase of unmarried population to exacerbate Korea’s labor supply

Wedding image. unsplash

If the number of unmarried people continues to grow at the current rate, it could have a significant impact on labor supply in the future, according to an analysis. By gender, the increase in the proportion of the unmarried population is likely to increase the female labor supply and decrease the male labor supply.

According to the report, "Long-term Trends in the Growth of the Unmarried Population and Labor Supply," released by the Bank of Korea on January 8, the trends of “late marriage” and "non-marriage" are intensifying. The age of first marriage has increased rapidly for men, from 29.3 years in 2000 to 33.7 years in 2022, and for women, from 26.5 years to 31.3 years. The proportion of unmarried people in the core 30-54 age group has increased significantly, from 16 percent in 2013 to 28 percent last year. By educational level, 27.4 percent of men with higher education were unmarried and 30.9 percent were less educated in the core age group last year, while 28.1 percent of women were unmarried and 15.9 percent were less educated.

The proportion of non-marriage in the labor market is also increasing rapidly, and the effect of the increase in the non-marriage population on the labor supply was different by gender.

First of all, for men, the increase in the proportion of the unmarried population was found to act as a factor to reduce the total amount of labor supply.

The labor force participation rate and employment rate for married men (averaged over 2013-2023) were 96 percent and 95 percent, respectively, 13 percentage points higher than those of unmarried men. For women, on the other hand, the increase in the proportion of the unmarried population is a factor that increases the total amount of labor supply. The economic activity participation rate and employment rate of married women are 62 percent and 60 percent, respectively, 19 percentage points and 16 percentage points lower than that of unmarried women.

This means that the increase in the proportion of the non-married population is affecting the labor force participation rate and average work hours for men, and vice versa for women.

Taken together, the changes over the past decade suggest that the increase in the proportion of the non-married population in the core age group has acted as a factor to reduce the total labor supply in Korea. In particular, as the increase in non-marriage eventually exacerbates the low birthrate problem, it is a structure that will definitely hurt the future labor supply.

The Bank of Korea estimated the long-term trend of labor supply by comprehensively considering changes in marriage and birth rates and found that the labor force participation rate is expected to peak in 2031 (79.7 percent) and decline thereafter if the non-marriage proportion reaches 60 percent for men and 50 percent for women in 30 years.

This is four years earlier than the estimated peak (2035) in a scenario with a smaller proportion of non-marriage after 30 years (50 percent for men and 40 percent for women) or a scenario that does not take into account for the increase in the proportion of non-marriage. The analysis also found that the rate of decline after the peak accelerated as the proportion of non-marriage increased.

The Bank of Korea said in a report, "As the growth of the unmarried population is a structural trend that is difficult to reverse, it is necessary to approach with a combination of mitigation policies to increase the marriage rate and adaptation policies to create working environments tailored to the characteristics of the unmarried population and increase the labor market participation of the unmarried.”

※This article has undergone review by a professional translator after being translated by an AI translation tool.