South Korea

   

Social Policies

#18
Key Findings
Producing strong education and health systems, South Korea’s social policies fall into the upper-middle ranks (rank 18) in international comparison. Its score on this measure has improved by 0.2 points since 2014.

Education outcomes are good, and tertiary enrollment rates are high. The new administration has promised to address inequality issues by turning expensive “elite” schools into free regular schools. While the universally available health care system is of high quality, overall spending on health is comparatively low. Government-funded coverage is being expanded.

Inequality is rising, and relative poverty remains a serious problem. Transfer payments do little to prevent poverty. Women face considerable disincentives to joining the work force, and policies aimed at helping women combine work and parenting have had little overall effect.

However, old-age poverty is a major problem. The government is raising the basic pension for low-income seniors, and a more general pension reform is on the agenda. Though immigration rates are rising, the country’s cultural, educational and social policies still fail to address the role of migrants in Korea systematically.

Education

#4

To what extent does education policy deliver high-quality, equitable and efficient education and training?

10
 9

Education policy fully achieves the criteria.
 8
 7
 6


Education policy largely achieves the criteria.
 5
 4
 3


Education policy partially achieves the criteria.
 2
 1

Education policy does not achieve the criteria at all.
Education Policy
8
Education policy is a key priority for the South Korean government. On the positive side, Program for International Student Assessment (PISA) test results are good, and tertiary enrollment rates are high. South Korea’s rankings in the 2015 PISA international student-assessment tests slipped slightly as compared to three years previously, though it still remains among the top eight OECD-member countries. In 2014, 6.3% of GDP was spent on education institutions, compared to an OECD average of 5.2%. Of this total expenditure, 1.7% of GDP represents private expenditure, which is more than twice the OECD average. This is largely because many Koreans spend a large share of their income on private tutoring academies (hagwons), a practice that puts low-income households at a disadvantage. To address this disparity, the Moon government promised to turn expensive “elite schools” into regular schools that offer free education. The Moon administration also announced that it will pass a law banning discrimination based on academic background.

University entrance exams are a particularly controversial issue. While they have played an important role in allowing relatively equitable access to top universities, they are seen as a major cause of a lack of creativity as well as weak analytical and discussion skills. Many attempts at education reform have been made, but cramming and rote learning are still favored over analytic skills, discussion and creativity.

Citations:
OECD, Education at Glance at a Glance 2017
Korea Times. Moon’s education pledges under scrutiny. May 10 2017. http://www.koreatimes.co.kr/www/nation/2017/05/181_229082.html
University World News. Is South Korea in a Higher Education Access Trap? July 14, 2017. http://www.universityworldnews.com/article.php?story=20170711111525929

Social Inclusion

#25

To what extent does social policy prevent exclusion and decoupling from society?

10
 9

Policies very effectively enable societal inclusion and ensure equal opportunities.
 8
 7
 6


For the most part, policies enable societal inclusion effectively and ensure equal opportunities.
 5
 4
 3


For the most part, policies fail to prevent societal exclusion effectively and ensure equal opportunities.
 2
 1

Policies exacerbate unequal opportunities and exclusion from society.
Social Inclusion Policy
6
While still smaller than the OECD average, the gap between rich and poor has widened significantly in South Korea in the past 15 years, and continued to do so during the assessment period. Poverty rates are still above OECD average and old-age poverty in particular is one of the country’s urgent inequality issues. Almost half (47.7%) of its citizens aged over 65 currently live in relative poverty. In 2016, the poverty rate among Korea’s elderly population was the highest in the OECD, at more than four times the OECD average of 12.1%. Criticism of the government’s lack of action on this issue is growing in strength. The South Korean tax and welfare systems are not designed to reduce inequality, and their capacity to prevent poverty is very limited given the low level of social-transfer payments. These small payments force unemployed individuals to accept any job offer, even if wages are much lower than in their previous employment. The welfare system also depends on family-based security, with parents typically willing to support their children even after completion of a university degree. Young people in particular still suffer from social exclusion. The degree of gender equality is also still far below the OECD average. The Moon administration is seeking to redress some of these imbalances, however. For example, it has announced that it will raise the basic-allowance amount to KRW 300,000 for 70% of the elderly population in the low-income group. It will seek to double the number of available jobs for seniors by creating 30,000 government-provided jobs for senior citizens. More broadly, the administration is also seeking to redesign the tax and welfare systems to enhance their redistribution effect.

The influx of North Korean defectors has raised potentially troublesome issues of integration into South Korea’s workforce. Available data on the work integration of North Korean defectors reveals this group’s marginalization within the primary labor market, with other indicators also showing poor labor-force integration. There has been some improvement in terms of embracing multicultural families and providing support for migrant workers, but South Korea still has a long way to go before becoming a genuinely inclusive society.

Citations:
The Guardian. South Korea’s inequality paradox: long life, good health and poverty. August 2, 2017. https://www.theguardian.com/inequality/2017/aug/02/south-koreas-inequality-paradox-long-life-good-health-and-poverty
Yonhap News. Moon’s pledges: senior citizens. May 10 2017. http://english.yonhapnews.co.kr/news/2017/05/08/0200000000AEN20170508001400320.html

Health

#5

To what extent do health care policies provide high-quality, inclusive and cost-efficient health care?

10
 9

Health care policy achieves the criteria fully.
 8
 7
 6


Health care policy achieves the criteria largely.
 5
 4
 3


Health care policy achieves the criteria partly.
 2
 1

Health care policy does not achieve the criteria at all.
Health Policy
8
South Korea’s health care system is characterized by universal coverage and one of the highest life expectancies in the world, all while having one of the OECD’s lowest levels of overall health expenditure. President Moon has announced a new “Mooncare” health care plan, and the government will provide KRW 30.6 trillion ($26.8 billion) over the next five years to cover all medical treatments. In the future, medical insurance will cover all forms of treatment, excluding plastic surgery and cosmetic procedures. Additionally, new measures that can act as safety nets for families facing astronomical health care costs have been announced. The government’s intention is to create a medical safety net that leaves no patient untreated in times of emergency. The Moon administration has thus proposed expanding the state insurance policy to include not only the four major diseases – cancer, cardiac disorders, cerebrovascular diseases and rare incurable illnesses – but all other major diseases, including Alzheimer’s disease. Under the newly proposed health care policy, patients in the lower 50% of the income bracket would be able to receive medical coverage costing up to KRW 20 million.

Citations:
OECD, OECD Health Policy Overview: Health Policy in Korea. April 2016. https://www.oecd.org/korea/Health-Policy-in-Korea-April-2016.pdf
Korea.net. President announces new ‘Mooncare’ health care plan. Aug 11, 2017. http://www.korea.net/NewsFocus/policies/view?articleId=148430

Families

#26

To what extent do family support policies enable women to combine parenting with participation in the labor market?

10
 9

Family support policies effectively enable women to combine parenting with employment.
 8
 7
 6


Family support policies provide some support for women who want to combine parenting and employment.
 5
 4
 3


Family support policies provide only few opportunities for women who want to combine parenting and employment.
 2
 1

Family support policies force most women to opt for either parenting or employment.
Family Policy
5
South Korea has the second-lowest fertility rate in the OECD. The government has not been very effective in enabling women to combine parenting with participation in the labor market, which helps explain the low labor-market participation rate. The traditional Confucian family values that view women as mothers and housewives remain influential. High housing prices, high child-care and education costs, and precarious job and wage conditions are the most important factors in young couples’ decisions not to have children. Cultural and socioeconomic factors such as a gender pay gap of 36.6%, the highest among OECD countries, as well as pervasive social immobility, discourage women from entering or reentering the workforce. As a result, while college graduates are split fairly evenly between men and women, the employment rate for female graduates is lower than for male graduates. Furthermore, South Korea is the only country in the OECD where the employment rate of female college graduates is lower than that of women with no more than compulsory education.

Citations:
New York Times, 5 January 2010
Kim Sangmook, 2008, Women and family-friendly policies in the Korean government, International Review of Administrative Sciences, Vol. 74, No. 3, 463-476
The Global Gender Gap Report 2013, The World Economic Forum, http://www3.weforum.org/docs/WEF_GenderGap_Report_2013.pdf
South Korea’s Failure to Support Working Women, The Diplomat, Aug 20, 2014, http://thediplomat.com/2014/08/south-koreas-failure-to-support-working-women/
OECD, Gender wage gap data. https://www.oecd.org/gender/data/genderwagegap.htm

Pensions

#29

To what extent does pension policy realize goals of poverty prevention, intergenerational equity and fiscal sustainability?

10
 9

Pension policy achieves the objectives fully.
 8
 7
 6


Pension policy achieves the objectives largely.
 5
 4
 3


Pension policy achieves the objectives partly.
 2
 1

Pension policy does not achieve the objectives at all.
Pension Policy
6
Old-age poverty is a major problem in South Korea, as pensions are small, and most elderly people today lack coverage under a national pension system that did not cover a large share of the workforce until its expansion in 1999. The government has also failed to enforce mandatory participation in the system, and many employers fail to register their employees for participation. The level of the national pension benefit is still very low. By contrast, subscribers to the four occupational pension funds enjoy relatively high benefits, a state of inequality that also provokes considerable controversy. President Moon has pledged to raise the basic pension to KRW 300,000 a month from the current maximum of KRW 206,050, with benefit eligibility coming at the age of 65. This pension will be provided to the 70% of elderly classified as low-income.

Given the low fertility rate, the old-age dependency ratio is expected to increase rapidly in the future. Thus, improving sustainability within the public pension systems is an important although not immediately urgent task. Previously, the country’s pension funds have been vulnerable to government interference. For this reason, pension reform has been one of the Moon administration’s top priorities.

Citations:
Moon, Hyungpyo. The Korean Pension System: Current State and Tasks Ahead. KDI.
Banjo, Shelly. Korea’s Stubborn Leviathan. Sep 11, 2017. https://www.bloomberg.com/news/articles/2017-09-11/korea-s-reform-block-the-495-billion-national-pension-service

Integration

#23

How effectively do policies support the integration of migrants into society?

10
 9

Cultural, education and social policies effectively support the integration of migrants into society.
 8
 7
 6


Cultural, education and social policies seek to integrate migrants into society, but have failed to do so effectively.
 5
 4
 3


Cultural, education and social policies do not focus on integrating migrants into society.
 2
 1

Cultural, education and social policies segregate migrant communities from the majority society.
Integration Policy
5
Since the 1990s, South Korea has evolved from a net-emigration to a net-immigration society. In 2016, foreign nationals residing in Korea accounted for approximately 4% of the total population of 51 million. Within this foreign-national population, about 1 million come from China, with the share of Vietnam and U.S. nationals trailing well behind (at about 150,000 each). South Koreans are used to seeing their country as culturally and ethnically homogeneous, but the number of migrant workers and multicultural marriages is slowly changing this perception. According to the Korean Statistical Information Service, almost 1 million residents live within multicultural families, making Korea an increasingly multicultural society.

Despite the increasing population of migrants and citizens with a family background of migration, as well as improvements in the legal conditions and support provided to multicultural families, the country’s cultural, education and social policies still fail to systematically address the role of migrants in Korea. While ethnic Koreans with foreign passports, foreign investors and highly educated foreigners are welcomed and treated favorably, Amnesty International reports that migrant blue-collar workers are often treated as “disposable labor.” From a legal perspective, migrant workers have very similar rights to native Korean employees, but these rights are routinely neglected by employers. While courts have offered some protection to migrant workers, the government has not pursued active enforcement measures against employers that exploit the precarious status of migrant workers.

Citations:
HanKyung. No. of Foreign Nationals Residing in Korea Exceeds 2 million in 2016. June 22, 2017.
Korea Herald, Multicultural familes left out in election, as always. May 3, 2017.
Korea.net. Transformation into a Multicultural Society.
Sang-young Rhyu. “The Challenge of Social Integration in South Korea,” Global Asia, Vol.12, No.2 (Summer 2017), 30-35.
Yonhap News. Reasons for expecting new government multicultural policy. August 29, 2017.
Segye Daily.

Safe Living

#3

How effectively does internal security policy protect citizens against security risks?

10
 9

Internal security policy protects citizens against security risks very effectively.
 8
 7
 6


Internal security policy protects citizens against security risks more or less effectively.
 5
 4
 3


Internal security policy does not effectively protect citizens against security risks.
 2
 1

Internal security policy exacerbates the security risks.
Safe Living Conditions
9
While police statistics show a small increase both in violent crime and street crimes over the last few years, the absolute levels of both remain low in comparison to other OECD countries. There have been no terror attacks or terrorist activities in Korea in recent years. Nevertheless, extensive media reports about violent crimes have led to an increasing feeling of insecurity. The spread of financial scams (“phishing”) and cyber-crime, whose perpetrators take advantage of South Korea’s excellent broadband infrastructure and lax online-security measures, is a major concern that has not yet been effectively addressed. The lax enforcement of traffic laws remains a major problem; South Korea has the OECD’s fourth-highest ratio of road fatalities, with 91.3 deaths per 1 million residents. Respect for and trust in the police is generally low. While an earthquake in Gyeongju in September 2016 resulted in no casualties, it reinforced worries that the government has failed to improve its disaster- and accident-response policies since the Sewol Ferry catastrophe in 2014.

Citations:
WHO, Global Health Observatory Data Repository, http://apps.who.int/gho/data/view.m ain.51310
Korean Statistical Information Service. National Crime Statistics. 2017.
The Overseas Security Advisory Coucil(OSAC) of the United States. South Korea 2017 Crime and Safety Report.
OECD. Road Accidents Statistics, https://data.oecd.org/transport/road-accidents.htm

Global Inequalities

#25

To what extent does the government demonstrate an active and coherent commitment to promoting equal socioeconomic opportunities in developing countries?

10
 9

The government actively and coherently engages in international efforts to promote equal socioeconomic opportunities in developing countries. It frequently demonstrates initiative and responsibility, and acts as an agenda-setter.
 8
 7
 6


The government actively engages in international efforts to promote equal socioeconomic opportunities in developing countries. However, some of its measures or policies lack coherence.
 5
 4
 3


The government shows limited engagement in international efforts to promote equal socioeconomic opportunities in developing countries. Many of its measures or policies lack coherence.
 2
 1

The government does not contribute (and often undermines) efforts to promote equal socioeconomic opportunities in developing countries.
Global Social Policy
6
South Korea is a relatively new donor in the field of development cooperation. In 2016, the country provided $1.96 billion in net official development assistance (ODA), representing 0.14% of gross national income (GNI). Increase in ODA spending stalled under the Park administration, and Korea failed to achieve its goal of increasing spending to 0.25% of GNI in 2015. It has set a new ODA target of 0.30% of GNI by 2030. Korea’s aid also fails to meet the recommendations of the OECD Development Assistance Committee (DAC), for example when with respect to the share of grants and both untied and multilateral aid. It remains to be seen whether the Moon administration will revitalize Korean development cooperation.
With regard to activity supporting a fair global trading system, South Korea has shown weak initiative. It has largely focused on negotiating a number of preferential trade agreements with the European Union and the United States, as well as with many developing countries. Market access for products from developing countries also remains limited in Korea.

Citations:
OECD, Development Co-operation Report. 2017.
OECD, KOREA Development Assistance Committee (DAC), PEER REVIEW 2012, http://www.oecd.org/dac/peer-review s/Korea%20CRC%20-%20FINAL%2021%20JA N.pdf
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