[비즈한국] Government ministries are racing to roll out various programs to support youth asset formation. The underlying rationale is that young people entering society for the first time after high school or college lack the "seed money" needed to start a family or secure a home, and thus require support to establish financial independence and a solid economic foundation. However, critics point out that because the standards for these policies vary across ministries, it actually causes confusion for young people trying to find support programs that fit their specific situations.
Another identified issue is that most of these policies are designed exclusively for regular or permanent employees who can prove a stable income above a certain level. This is problematic because, due to economic crises, a significant portion of youth employment now consists of freelancers, platform workers, and short-term contract workers. In fact, the proportion of non-regular workers among Korea's youth has reached an all-time high this year, meaning effectively half of the youth population is in a position where they cannot qualify for government asset formation support.
According to the National Assembly and the government, various ministries have been running asset formation support programs in recognition of the economic difficulties faced by young people entering the workforce. Representative programs include the Ministry of Employment and Labor’s "Youth Tomorrow Chaeum Deduction," the Ministry of SMEs and Startups’ "Youth Worker Tomorrow Chaeum Deduction," the Financial Services Commission’s "Youth Leap Account," and the Ministry of Health and Welfare’s "Youth Tomorrow Savings Account."
The Ministry of Employment and Labor's Youth Tomorrow Chaeum Deduction ran from 2016 to 2023. It was a system that provided a total of 12 million won upon a 2-year maturity (4 million won from the youth + 4 million won from the company + 4 million won from the government) for young people newly employed by small and medium-sized enterprises (SMEs) or mid-sized companies.
In contrast, the Ministry of SMEs and Startups' Youth Worker Tomorrow Chaeum Deduction, which ran from 2018 to 2022, provided a total of 30 million won upon a 5-year maturity (7.2 million won from the youth + 12 million won from the company + 10.8 million won from the government) for young people who had been working at an SME for at least 6 months. Both the Youth Tomorrow Chaeum Deduction and the Youth Worker Tomorrow Chaeum Deduction were terminated due to their similarity and poor performance, such as low subscription rates. This reflects how difficult it was for young people to distinguish between the programs, leading to low participation.
The Financial Services Commission’s Youth Leap Account is a program that matches 3–6% of savings contributions for young people with an annual earned income of 75 million won or less, provided they save up to 600,000 won per month for 5 years. In the case of the Ministry of Health and Welfare’s Youth Tomorrow Savings Account, it provides a monthly government subsidy of 100,000 to 300,000 won matched to the individual's savings for young people with a monthly earned income of 500,000 to 2.5 million won. Among these, the Youth Leap Account is set to end this year, as the Lee Jae-myung administration has decided to launch a new "Youth Future Installment Savings" program due to sluggish implementation.
The reason these youth asset formation policies fail to take hold and are repeatedly discontinued is that, while the content of the policies from different ministries is similar, the eligibility criteria vary, leaving few young people actually eligible for support. Furthermore, programs like the Youth Tomorrow Chaeum Deduction and the Youth Worker Tomorrow Chaeum Deduction required employees to "stay employed at their current SME/mid-sized firm," which focused only on the employer's perspective and ignored the needs of young people seeking to advance their careers. In fact, for the Youth Worker Tomorrow Chaeum Deduction, the most common reason for termination was resignation due to job changes, accounting for 38.9% of cases.
Another problem is that these policies all target young people with stable, regular, or permanent jobs at SMEs and mid-sized companies. They overlook the fact that more than half of Korea’s workforce is currently composed of non-regular workers or the self-employed. According to the National Data Agency, a survey on employment by type of work this year showed that among young people aged 15 to 29, excluding the self-employed, the number of wage workers was 3.389 million, a 4.48% decrease from last year (3.548 million).
Among these, non-regular workers, such as temporary or part-time employees, reached 1.844 million, accounting for 45.59% of all wage workers. This is the highest level of non-regular youth employment since the survey began in 2003. This means that a significant number of young people are stuck in unstable or short-term jobs that prevent them from meeting the basic eligibility requirements for government asset formation policies.