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close this bookThe Transition of Youth from School to Work: Issues and Policies (IIEP, 2000, 188 p.)
close this folderChapter III. Transition from school to work in Korea: reforms to establish a new pathway structure across education and the labour market by Kioh Jeong
View the documentIntroduction
View the document1. Economic adjustment and youth in Korea
View the document2. Roles of institutions in school-to-work transition
View the document3. From school to work: business and industry involvement
View the document4. Ongoing education reform and implications for youth
View the document5. Conclusions: developing pathways

3. From school to work: business and industry involvement

3.1 Employer factors in school-to-work transition

The dichotomy of school-led transition and employer-led transition is a useful approach to review school-to-work transition in industrialized countries (OECD, 1996:6-7). Anglo-American countries were said to be of the former while the German system the latter. In the previous chapter the role of the school system in Korea was outlined. The Korean system is not developed enough and is still too amorphous to be categorized following the dichotomy. However, whatever form of transition holds in this country, the role of employers is extremely important in that their recruitment policies are the most influencing factor.

In Korea, the path from school to work has not been sufficiently studied to draw fully supported generalizations. There are no systematically developed practices, except that the one-shot competitive recruitment examination, leading to lifelong employment, is the main route to the primary labour market.

Table 11. Percentages of the path used to obtain current jobs, 1992

Recruitment examination

Job vacancy notice

Public employment service

Recommended by school

Friends or family

Self-employed

Non-classified

High school or under

5.6

8.0

1.7

4.1

52.8

26.4

1.4

Higher education

27.1

5.3

0.1

12.4

31.3

20.8

2.6

Source: W.S. Jang, 1997: 189.

Table 12. Path from school to work on graduation, 1995

Recruitment Exam

Field practice work

Recommended by school

Friends or family

Self-employed

Non-classified

High school (academic)

6.2

24.9

29.3

23.1

62

10.2

High school (vocational)

7.3

18.9

57.1

11.9

2.1

2.7

2-year college

20.3

53.8

20.6

University and colleges

472

31.6

6.0

15.1

Source: Ministry of Education, Korea.

The above Tables 11 and 12 respectively reflect the aspects of the paths to work in Korea:

· Vocational high schools and junior colleges are more active in assisting their graduates to find jobs compared to universities.

· University graduates' major path to employment is the recruitment examination held by large companies.

· Work experience before graduation (fieldwork practice) is an important factor in finding jobs when departing from school. It is more effective in the case of academic high-school graduates. (However, the field practice does not appear as an important path in Table 12, which means that high-school graduates stay very shortly in the first job they got through field practice).

· Informal recommendation by friends or family is still the most frequent path to employment in the current job market (Table 11). The lower the worker's school attainment, the greater his/her dependency on this informal path.

· The public employment service plays an almost negligible role in assisting students to find employment.

In Korea, generally, the schools' role is very limited in assisting students to find jobs after graduation, and those with lower school attainment typically do not remain employed longer in their first job compared with the students completing higher education. High-school graduates are not usually happy with the first job they got through field practice or school recommendation. An inference is that marginal industries seeking low-cost employees tend to depend on high schools. The discontent with paid work used to lead the high school graduates to self-employment more than the college graduates, as is shown in Table 12. The employers' role can be reviewed in both macro and micro perspectives. In Korea, there has been growing concern to boost school-industry co-operation to aid school-to-work transition. Policy-makers have long been interested in the American models such as tech-preps and school-based enterprises based on the School-to-Work Opportunity Act 1994. However, the articulation at the micro level can hardly be developed without extensive reform at the macro level of the institutionalized relations across education and industry.

To begin with, in the case of the primary market described above, employers have little motivation to help and invest in education and training outside of enterprise. They do not expect schools to prepare students for jobs (KRIVET, 1997:45). They already invest too much in the internal labour market. Employers have had a tendency to over-employ and to keep unnecessary workers for future demands. Hence, the selection process, usually composed of an open application and an entrance examination, incurs a high transaction cost. In addition, because of the on-the-job vocational training, the organizational cost of human resource management tends to be high. In this system, the high human resource management costs, transaction and organizational costs hurt the competitiveness of the organization. The cost-push intensifies if wages increase as a result of union activity. So far, these factors have discouraged large employers from taking an interest in education-industry co-operation.

With regard to the co-operation, prevailing recruitment practices used by the large employers have influenced the curricula in colleges and universities, since the recruitment examination became the major pathway to the prestigious primary labour market, regardless of the academic specialization of the applicants. Thus, the nature of the transition into the primary labour market is employer-led: more aptly, led by the large employers. However, the schools and institutions have become completely de-coupled with the labour market. Only students have been influenced by the recruitment policies of large employers, regardless of the educational programmes they opted for.

However, practices are gradually changing (W.S. Jang, 1997:196-202). The three components that kept the segmented primary labour market possible, that is, universities and on-the-job training, recruitment examinations, and lifelong employment, began to change. A survey found that the weight of the recruitment examination has been on a steady downward trend, as shown in Table 13. Large companies are trying to diversify their recruitment practices by introducing internship programmes leading to employment, recruitment throughout the whole year freed from the one-shot basis, and so on. At the same time, the economic crisis and employment adjustment have made the companies less dependent on the lifelong employment practice. Inevitably, companies have begun increasingly outsourcing the training that had been developed in the form of in-company training. Universities are trying to adapt themselves to these changes, but very slowly.

Table 13. Trends in the pathway to work in the case of university graduates

1983

1986

1989

1992

Recruitment examination

47.6

52.5

40.7

32.4

Friends and family

17.7

15.8

32.2

25.5

Source: W.S. Jang, 1997: 190.

In the secondary labour market, the National Technical Qualification System played a great role of skill development, promoting youth transition into the manufacturing and construction industries. However, the inflexible statutory qualification system gradually became outmoded in the light of technological progress and occupational changes. From the beginning of the nineties, the system lost its effectiveness.

Having a common cultural base, Korea and Japan share many similar characteristics in education and labour. However, the job turnover in the two countries shows contrasting differences. Japan enjoys stable employment with a very low level of job turnover. In Korea, the rate was above 6 per cent even before the current economic crisis. In that, Korea bears similar traits to Anglo-American labour markets. However, the high job turnover in Korea is not so much an innate characteristic of the Korean labour market, but rather evidence of an underdeveloped workforce and weak industrial bases.

Despite continued economic growth from the second half of the 1980s to the mid-1990s, experts and policy-makers were seriously concerned about the shrinkage of the major economic components and agents which had supported the growth of the developing economy. Aside from the big firms and conglomerates, there have always been a lot of small and medium businesses (SMEs) struggling for survival. As well as the marginal manufacturers suffering from the wage hike, the strikingly underdeveloped services and merchandise sectors have also suffered.

As was mentioned earlier, the employment capacity in the secondary labour market gradually shrank and technical qualifications rapidly lost their validity. As a result, some junior colleges introduced employer-ordered instructional design in response to the industrial changes, while most of the commercial vocational high schools reshuffled the programme in order to prepare their students for information-processing jobs in the computerized work environment. In this way, informal networks to the world of work started to develop but were not widely diffused.

The government also initiated a school-to-industry transition path. The government introduced the one-year work experience programme in the third year of vocational high school, leading to high-school diploma. Led mainly by industries, the initiative was called the 2+1 programme. The programme is run on an experimental basis but, enrolments are diminishing. In 1998,9,110 students from 45 vocational high schools worked at 1,928 manufacturing sites. The five-year experiment is not deemed successful. Participating businesses were too small and did not have the capacity to provide on-the-job training. The programme simply served the demand for cheap labour.

So far, schools and institutions have utilized the informal network to link graduates and the employers. Students too, in their job search, were dependent on these informal networks and the employment service did not contribute much towards students finding jobs. However, significant changes are now taking place. A sample performance survey on the public employment service revealed, as seen in Table 14, that youth too are increasingly rushing to the public employment service offices. The Public Employment Service Authority has expanded the job information network. Despite the progress in this area, however, institutions and schools are not substantially integrated into the job information system, which is weakening the effectiveness of the information system.

Table 14. Performance sample of employment service offices, 1997-1998

Number of job offers

Number of job searchers


August 97

August 98

Increase (%)

August 97

August 98

Increase (%)

Whole age

18,399

39,403

114.2

17,721

141,466

698.3

20-29

10,192

18,535

81.9

8,325

53,606

543.9

Source: Ministry of Labour, Korea.

In summary, one might say there are few substantial and stable pathways for youth in the secondary labour market. There are very opportunistic and irregular pathways from school to work. Nevertheless, increasing expectation upon the role of the public employment service is a desirable move towards improving pathways to the labour market.

Although, until very recently before the economic crisis, vocational high-school graduates could still easily find jobs on leaving school, it was due to over-employment in the labour market in general. In the secondary labour market, they do not stay at the same workplace for any length of time. They have become exposed to the risk of long-term unemployment after the employment adjustment incurred by the economic crisis. Employers in this sector do not have the capacity to contribute to school-to-work transition through active participation.

As explained earlier, although the Korean labour market has been characterised by the typical segmentation between the primary and the secondary labour markets, changes in the labour market and the economy have blurred the line between the two. As employment practices begin to change in the labour market, a 'knock on' effect in the education and training system is inevitable. However, education and training has been controlled by highly institutionalized regulations for far too long. Education reform is an initiative requiring time and effort to promote the necessary changes corresponding to those changes in the labour market.