Amid Abysmally Low Birth Rate, South Korean Company Offers Employees $75,000 Each Time They Have a Baby
In response to South Korea's concerning birth rate, a Seoul-based company is taking proactive measures by offering financial incentives to its employees. The company plans to award employees 100 million Korean won ($75,000) for each child they have. The Booyoung Group has pledged to disburse a total of 7 billion Korean won ($5.25 million) in cash rewards to employees who have welcomed babies since 2021.
This initiative is inclusive of all employees, irrespective of their gender. South Korea's fertility rate, currently standing at 0.78, underscores the urgency of addressing the nation's demographic decline. This trend reflects a broader demographic challenge prevalent in many Asian countries.
Booyoung Group's Chairman Lee Joong-Keun emphasized the importance of "direct financial support" amid Europe's growing elderly population. The company offers employees with three babies the choice between receiving 300 million Korean won (approximately $225,000) in cash or rental housing, aiming to incentivize childbirth and address demographic concerns.
"I hope we would get recognized as a company that contributes to encouraging births… and worries about the country’s future," he remarked.
While the South Korean government has introduced initiatives to promote childbirth, none rival the scale of Booyoung Group's efforts. Meanwhile, China's Trip.com offers its employees 10,000 yuan ($1400) annually for each newborn child until the age of five, reflecting a similar trend of corporate support for family planning.
Despite the South Korean government's efforts, including providing a one-time payment of 1 million won (approximately $650) for pregnant women, there has been limited success in incentivizing couples to have more children. "Since many South Korean women have jobs these days, they are reluctant to have babies because it is extremely difficult to work and raise a child at the same time," said Kim Seong-kon, a professor emeritus of English at Seoul National University.
"Besides, pregnant women have to face serious disadvantages at work in South Korea. To make matters worse, many childcare facilities are not trustworthy, and good ones are hard to get into," Kim wrote in the Korea Herald via The Guardian.
South Korea has had the lowest fertility rate in the world since 2013, and couples are increasingly choosing to be child-free. Elon Musk, however, believes this to be dangerous, stating, "Population collapse due to low birth rates is a much bigger risk to civilization than global warming."
South Korea's population is forecast to fall by 14 million by 2070.— Zion Lights (@ziontree) November 29, 2023
Where’s the panic about underpopulation? Unlike the myth of “overpopulation,” underpopulation is real and harmful.https://t.co/bGGTeIHdjP
Marriage rates in the country have declined by over 35% in the last decade, despite the government's substantial investment of over $200 billion in programs to support new mothers over the past 16 years. Despite these schemes, fertility rates have dropped by more than 25% during this period.
Andrew Yeo, a senior fellow at the Brookings Institution's Center for East Asia Policy Studies, believes that the government must address "structural problems that aren't directly related to fertility." Moving forward, policymakers must prioritize a holistic approach to address societal and economic factors influencing family planning decisions, ensuring a sustainable future for the country.
More from MARKETREALIST