Young People Squeezed Out by AI and Preference for Experienced Workers... University Graduate Unemployment Hits 5-Year High

Young People in Their 20s and 30s Account for 64% of All Unemployed Graduates
Number of First-Time Job Seekers Rises for the First Time in Seven Years

The number of unemployed individuals who graduated from universities and junior colleges in the second quarter of this year exceeded 480,000. This is the highest level since the onset of COVID-19. In particular, those in their 20s and 30s accounted for more than 60% of all unemployed with a university degree.

According to a report by Yonhap News Agency on July 19, citing data from the National Statistical Portal (KOSIS) and employment trends provided by the Ministry of Data and Statistics, the number of unemployed individuals with a university degree or higher in the second quarter of this year reached 481,000. This represents an increase of 39,000 from the same period last year. On a second-quarter basis, it is the highest since 2021, when the impact of COVID-19 pushed the figure to 521,000, making this the largest number in five years.

By age group, unemployed university graduates in their 20s numbered 179,000, and those in their 30s totaled 130,000, bringing the sum for those two age groups to 309,000. This accounts for 64.2% of all unemployed individuals with a university degree or higher. Compared to the previous year, the number of unemployed in their 20s increased by 7,000 and those in their 30s by 27,000.

The number of unemployed individuals who graduated from universities and colleges in the second quarter of this year exceeded 480,000. Yonhap News Agency

The unemployment rate among university graduates also rose. The unemployment rate for those with a university degree or higher reached 3.0% in the second quarter of this year, up 0.2 percentage points from last year. Among those in their 20s, the rate stood at 8.3%, rising by 0.6 percentage points to its highest level for the same quarter since 2021. Similarly, the rate for individuals in their 30s increased by 0.6 percentage points to 2.9%.

The total number of unemployed was 855,000, which is 11,000 more than last year. The Ministry of Data and Statistics explained, "As the university enrollment rate increases, the university-educated population itself grows, leading to rises in both the number of employed and unemployed individuals." The ministry added, "However, considering that the unemployment rate for university graduates also climbed, it can be interpreted that the contraction in the labor market in the second quarter has been especially concentrated among the youth."

The number of young people unable to find their first job is also on the rise. The number of unemployed youth without previous job experience reached 56,000 in the second quarter of this year, an increase of 7,000 from a year earlier. This is the first year-on-year increase in seven years since 2019. In particular, unemployed individuals in their 20s without any job experience numbered 48,000, up 11,000 from last year, marking the highest second-quarter figure since 2021.

Experts say that companies’ preference for experienced workers and their expansion of rolling recruitment are aggravating youth unemployment. Since hiring new college graduates involves costs for training and adjustment over a certain period, companies are showing a stronger preference for so-called ‘mid-career rookies’ who can start work immediately.

There is also the possibility that the proliferation of artificial intelligence (AI) is affecting the situation. Byeonghun Seok, a professor in the Department of Economics at Ewha Womans University, told Yonhap News Agency, "AI tends to replace tasks typically performed by workers with less than five years of experience. As a result, there is a growing phenomenon where jobs previously held by young people are being replaced by AI."

This content was produced with the assistance of AI translation services.