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Retaining and Attracting Young Talent in Busan: A Comprehensive Policy Plan

General Report April 25, 2025
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  • As of April 25, 2025, Busan faces a critical challenge with a significant outflow of young residents aged 18 to 35, attributable to national demographic trends, ongoing economic stagnation, and the city's high cost of living. Recent analyses have underscored that this demographic shift not only reflects broader national concerns, such as South Korea's plunging birth rate—which stood at a globally low 0.92 in 2019—but also highlights the pressing need for policies tailored to retain and attract youth. The economic underperformance becomes particularly evident as Busan's GDP growth stagnates at or below 0.1%, culminating in a contraction of 0.2% in Q1 2025, demonstrating a direct correlation between economic conditions and youth migration. A study conducted in late 2024 revealed that around 35% of young individuals intending to leave Busan cited insufficient job opportunities, high costs, and lacking social infrastructure as their primary motivations. This alarming trend necessitates strategic interventions to reverse this outflow and rejuvenate the local economy.

  • To combat the multifaceted issues of youth outmigration, the proposed policy plan introduces a comprehensive strategy based on four key pillars: economic revitalization through industry diversification, targeted education aimed at aligning skill sets with market demands, initiatives to enhance quality of life, and a concerted effort to engage youth in civic activities. This roadmap outlines a phased implementation approach spanning five years, ensuring all stakeholders—including government, private sector participants, and educational institutions—are aligned towards common objectives. By addressing various bottlenecks such as high housing costs, limited job availability in high-growth sectors, and enhancing cultural and recreational amenities, Busan can improve its appeal as a vibrant urban area. Furthermore, prioritizing youth engagement through mentorship and civic participation will foster a robust sense of community, encouraging retention and attracting young talent.

  • Ultimately, sustained engagement is essential to create a thriving, sustainable urban environment that not only encourages current youth to stay but also attracts new residents. With data-driven insights guiding policy formulation and implementation, Busan is positioned to build a resilient demographic structure capable of navigating future challenges.

Background and Rationale

  • National demographic trends and Busan’s age profile

  • South Korea is facing significant demographic challenges, characterized by a consistently low birth rate and an aging population. This trend has led to a shift in the age profile of cities, notably Busan. As highlighted in a report by the Korea Chamber of Commerce and Industry (KCCI) published on April 23, 2025, the average total fertility rate (TFR) in South Korea continues to reflect a declining pattern. After falling below the critical replacement level of 2.1 in 1983, the TFR has plummeted further, reaching an alarming low of 0.92 in 2019—the lowest globally. This downturn is not merely a statistical anomaly but a reflection of prolonged socio-economic adjustments, including changing attitudes towards marriage and parenthood among the younger generation. Recent commentary suggests that while a majority of young South Koreans still value parenthood, a significant disconnect exists between this sentiment and their ability to act on it, influenced by economic pressures and a competitive job market. Economic conditions have intensified the pressure on young professionals, leading many to prioritize career advancement over starting a family. These shifts necessitate immediate and effective policy responses to ensure the retention of youth in Busan as the city strives to cultivate a balanced demographic profile.

  • Economic performance and stagnation in South Korea

  • The economic landscape in South Korea is marked by stagnation, which has profound implications for the population dynamics in Busan. Recent reports indicate that the GDP growth rate has hovered at or below 0.1% for the past four quarters, culminating in a reported contraction of 0.2% in Q1 of 2025, as announced by the Bank of Korea on April 24, 2025. Key drivers of this stagnation include declining domestic consumption, falling exports, and a troubling drop in both facility and construction investments, which have contributed to an overall downturn in industrial demand. These economic factors undermine job creation—the very element essential for retaining young talent in urban centers like Busan. The long-term sustainability of economic growth related to these currents is critical. As international institutions revise forecasts downward, illustrating the breadth of economic malaise—such as the IMF's reduction of its growth estimate to 1%—it becomes evident that without structural reforms and revitalization initiatives, youth retention efforts across Busan will yield limited results. The forecasted economic recovery hinges on effectively stimulating growth amidst these persistent challenges, with cooperative strategies between local and national governments deemed essential.

  • Social implications of youth outmigration

  • Youth outmigration poses profound social implications for Busan, as young residents between the ages of 18-35 increasingly leave the city in search of better opportunities. Issues such as high living costs, limited career prospects, and a lack of adequate social infrastructure compel this demographic to seek refuge in cities with promising economic climates. The implications are not merely economic; they affect the city’s cultural vibrancy and community strength, which are critical to sustaining a dynamic urban environment. Cultural insights reveal a shifting perspective among youth in South Korea, where traditional values surrounding marriage and family are increasingly questioned. Economic uncertainty often leads to the postponement of significant life decisions, thus contributing to a generational disconnect with the established norms of previous decades. The findings from a study presented in the Korea population report emphasize that while many young people express a desire for family, the prevailing economic challenges hinder them from pursuing these aspirations. Addressing the multi-faceted causes of youth outmigration will be crucial for Busan's policymakers as they develop effective interventions to reverse demographic decline and enhance appeal as a residence for young professionals.

Current Status of Youth Outflow in Busan

  • Migration patterns and destinations of young people

  • The youth outflow from Busan has intensified in recent years, primarily affecting individuals aged 18 to 35. Many young residents have decided to relocate to larger metropolitan areas such as Seoul and Incheon in search of better employment prospects, higher salaries, and improved living conditions. In 2024, a significant survey highlighted that approximately 35% of respondents in the 18-35 age group expressed a desire to leave Busan for these reasons. This trend can be attributed to a combination of factors, including the allure of urban centers that offer more vibrant job markets and extensive networks supporting career advancement.

  • Moreover, the migration trend is marked by a lack of returnees; those who leave often do not come back. The allure of Seoul, characterized by robust job opportunities in tech and finance, pulls young people away from Busan where job creation has not kept pace with expectations.

  • Local employment rates and sectoral analysis

  • As of early 2025, the employment landscape in Busan remains challenging, particularly for young job seekers. The overall youth unemployment rate is notably higher than the national average, predominantly due to a skills mismatch and the predominance of low-value job creation. The recent economic data indicates that major industries in Busan, such as shipbuilding and fishing, have contracted, leading to reduced entry-level opportunities for recent graduates.

  • Furthermore, sectoral analysis reveals that high-growth sectors such as technology and green energy have relatively few positions available, exacerbating the youth outflow as young professionals are actively seeking positions in sectors aligned with their skills and educational backgrounds. In March 2025, only about 15% of job openings in Busan were reported as high-value jobs, emphasizing the need for economic diversification to retain local talent.

  • Housing costs and urban living challenges

  • In addition to employment challenges, young residents in Busan face rising housing costs that have contributed significantly to the outflow. The 2025 real estate market analysis indicates that rental prices in popular districts have increased by 10% since 2023, placing considerable financial strain on young citizens. This issue is compounded by stagnant wages and a limited supply of affordable housing options tailored to the needs of young professionals seeking to establish their lives in the city.

  • Furthermore, the appeal of urban living in Busan diminishes as younger demographics cite a lack of modern amenities and social infrastructure necessary for a quality lifestyle. Many express dissatisfaction with public transportation, leisure facilities, and healthcare services, which they perceive as subpar compared to those in larger cities. These living challenges lead to an overall decline in the quality of life in Busan, pushing young people to seek more accommodating environments elsewhere.

Key Challenges

  • Insufficient social infrastructure and cultural amenities

  • The allure of urban life for young adults extends beyond employment and housing; social infrastructure plays a pivotal role in attracting talent. Busan has struggled to cultivate a dynamic cultural scene and adequate social amenities that meet the evolving preferences of the youth. While the government has initiated plans to enhance cultural offerings, there is still a perceived lack of engaging social spaces and activities that resonate with younger generations. For example, the need for inclusive recreational areas, community hubs, and diverse entertainment options remains unmet. Addressing the deficit in social infrastructure is crucial not only for retaining young residents but also for creating a vibrant city atmosphere that can draw in new talent from outside the region. The current emphasis on limited cultural offerings may deter young individuals who are seeking a well-rounded lifestyle.

Policy Recommendations

  • Economic revitalization: industry diversification and startup ecosystem

  • To effectively counter youth outflow in Busan, a multifaceted approach to economic revitalization is essential. The proposed strategy emphasizes industry diversification and the creation of a robust startup ecosystem. Busan can leverage its geographic advantages and existing industrial strengths in sectors such as shipbuilding and tourism to attract new businesses and foster innovation. A comprehensive plan should include incentives for startups, such as tax breaks and access to funding, to cultivate a vibrant entrepreneurial culture. Partnerships with educational institutions can also facilitate the development of industry-relevant skills among youth, thus enhancing employability and encouraging them to remain in or return to Busan.

  • Education and skills development: AI literacy and vocational pipelines

  • As generational demands shift with technological advancements, there is an urgent need to incorporate AI literacy into the educational framework of Busan. With approximately 70% of teenagers already utilizing generative AI, educational institutions must pivot to provide comprehensive training on effectively engaging with these technologies. Recent initiatives by the Korean government highlight a move toward AI-supportive learning systems, such as the partnership with EBS to implement self-directed AI learning tools. Establishing vocational pipelines that integrate AI training will have a dual benefit: equipping youth with the skills for emerging industries while addressing the current skills mismatch that contributes to youth migration.

  • Quality-of-life improvements: affordable housing and cultural hubs

  • Improving the quality of life in Busan is critical for reversing youth outflow. This includes addressing the pressing issue of housing affordability, which has been a significant barrier for young residents. Policies should focus on expanding affordable housing projects and developing mixed-use communities that foster vibrant urban living. Furthermore, enhancing cultural amenities and public spaces can create a more inviting environment for young people, making Busan not only a place to work but also an enjoyable location to live and socialize. Initiatives that promote local arts, entertainment, and recreational activities will greatly enhance the city’s appeal.

  • Youth engagement: civic participation and mentoring networks

  • Active youth engagement in civic and community activities is paramount for fostering a sense of belonging among young residents. Building mentoring networks that connect young individuals with experienced professionals can provide invaluable guidance and support. Programs encouraging civic participation—not just in political processes but also in community improvement initiatives—can empower youth to take an active role in shaping the future of Busan. Such engagement not only benefits the individuals involved but also helps to cultivate a vibrant, responsive community that is attuned to the needs and aspirations of its younger population.

Implementation Roadmap and Monitoring

  • Phased timeline and priority milestones

  • The implementation roadmap proposes a structured timeline to execute the policy recommendations, scheduled over a five-year period. This timeline consists of key phases:

  • 1. **Phase One (2025-2026):** Initial groundwork involving stakeholder engagement and baseline assessments will be conducted. During this phase, essential milestones include securing partnerships with private enterprises and academic institutions to align efforts and define benchmarks for success.

  • 2. **Phase Two (2027-2028):** Focus will shift towards launching targeted initiatives such as job creation programs and vocational training workshops. Priority milestones include the implementation of at least three pilot projects in high-demand sectors, aimed at attracting youth participation.

  • 3. **Phase Three (2029):** This phase will assess the effectiveness of previously launched initiatives through comprehensive data collections and surveys. Milestones will include publishing an evaluation report and making necessary adjustments based on feedback and outcomes.

  • Roles of government, private sector, and academia

  • An effective implementation strategy necessitates collaborative roles among key stakeholders:

  • - **Government**: Responsible for policy formulation, oversight, and funding allocation. Government bodies are tasked with ensuring a conducive regulatory environment for business and employment. Additionally, they will lead public awareness campaigns to attract youth back to Busan.

  • - **Private Sector**: Engaging businesses is crucial, as they will provide job opportunities and contribute to the development of industry-specific skills training programs. Partnerships with tech startups and established companies are vital for creating internships and job placements.

  • - **Academia**: Educational institutions will play a key role in curriculum development for vocational training tailored to meet the needs of local industries. They will conduct research on demographic trends and skills gaps, providing an evidence base for continuous policy refinement.

  • Funding sources and budget allocation

  • The successful implementation of this policy plan hinges on diversified funding sources. Budget allocation strategies under consideration include:

  • - **Government Funding**: Allocations from local and national budgets dedicated to economic development and youth programs will be critical. This may also involve reallocating existing resources for more effective use.

  • - **Private Investment**: Encouraging local businesses to invest in community programs can foster a sense of ownership and motivation to address youth outmigration. Public-private partnerships could be established to share the costs of training programs.

  • - **Grants and Subsidies**: Exploring national and international grants aimed at economic development and youth engagement initiatives may provide additional funding avenues. An initial target could involve securing commitments from at least two external funding organizations to support pilot projects.

  • Key performance indicators and evaluation framework

  • To ensure oversight and accountability, an evaluation framework incorporating key performance indicators (KPIs) will be established. These KPIs will measure the effectiveness and impact of the policy initiatives. Key indicators may include:

  • - **Youth Retention Rate**: Tracking the percentage of youth aged 18-35 who remain in Busan following the implementation of the proposed programs. A target could be set to increase retention by at least 15% by the end of the five-year period.

  • - **Employment Rates in Target Sectors**: Assessing job creation specific to sectors targeted by the policy initiatives will gauge economic revitalization efforts. The goal could be to reach a minimum of 1, 500 new jobs created annually in high-potential industries.

  • - **Program Participation Rates**: Monitoring engagement levels in vocational and education programs will provide insights into youth interest and needs. Aim to achieve at least 3, 000 youth participating in newly offered programs in the first three years.

Wrap Up

  • As we conclude our examination of policies aimed at reversing youth outflow from Busan, it becomes evident that a comprehensive, data-informed approach is crucial for addressing this multifaceted issue. The combination of economic diversification, targeted educational initiatives, improved living conditions, and community engagement serves as a holistic framework for sustaining and attracting young talent in the city. Implementing industry-led job creation projects will be essential for providing young residents with the necessary opportunities to thrive, while expanding AI literacy and vocational training programs can ensure that they are equipped with skills relevant to emerging job markets.

  • Moreover, tackling the pressing challenges of housing affordability and enhancing public spaces is vital for elevating the overall quality of life in Busan. Creating vibrant, communal environments through cultural hubs and recreational areas will not only retain current youth but also attract newcomers, contributing to a dynamic demographic profile. Concurrently, engaging young people in civic life will reinforce their connection to the city and encourage them to play an active role in shaping Busan's future.

  • Looking forward, the successful implementation of these initiatives hinges on a clear roadmap that delineates roles for government, the private sector, and academic institutions while establishing sustainable funding sources and rigorous monitoring systems. As Busan embarks on this crucial undertaking, the commitment to adapting these policies based on real-time evaluation will be essential to achieving lasting demographic resilience. With a concerted effort, Busan can redefine itself as a vibrant, attractive urban center poised to harness the potential of its youth for a prosperous future.

Glossary

  • Busan: Busan is a major city in South Korea, known for its port and cultural heritage. As of April 2025, it is experiencing significant challenges related to youth outmigration, largely due to economic stagnation and high living costs.
  • Youth Outflow: Youth outflow refers to the migration of young individuals, typically aged 18-35, from one area to another in search of better opportunities. In Busan, this phenomenon is primarily driven by economic factors, limited job prospects, and high living expenses.
  • Demographic Change: Demographic change encompasses shifts in population structures, such as age distribution and birth rates. In South Korea, including Busan, these changes are characterized by a declining birth rate and an aging population, impacting economic dynamics and cultural vitality.
  • Low Birth Rate: Low birth rate refers to a situation where the number of live births in a population falls below the level required to maintain its size. South Korea's birth rate hit a global low of 0.92 in 2019, contributing to the youth outflow as fewer young people enter the workforce.
  • Economic Stagnation: Economic stagnation is a prolonged period of slow or no economic growth. As of early 2025, Busan's GDP growth has stagnated at or below 0.1%, indicating systemic economic issues that hinder job creation and exacerbate youth migration.
  • Employment: Employment refers to the condition of having paid work. In Busan, challenges in employment for youth stem from skills mismatches and limited availability of high-value job opportunities in rapidly growing industries.
  • Education: Education encompasses the systems and institutions involved in teaching and learning. In the context of retaining youth in Busan, enhancing educational programs to align skills with job market needs is viewed as a critical component of the proposed policy solutions.
  • Quality of Life: Quality of life is a subjective measure of a person's overall well-being, including economic, social, cultural, and environmental factors. In Busan, rising housing costs and inadequate social infrastructure negatively affect the quality of life for young residents.
  • Skills Development: Skills development refers to the process of improving capabilities and competencies in various fields of work. Policies aimed at enhancing skills development in Busan, particularly in areas like AI and vocational training, are critical for addressing youth outmigration.
  • Civic Participation: Civic participation involves engagement in the democratic process and community activities. In Busan, fostering civic participation among youth is considered essential for building a sense of belonging and empowerment, which may help retain young residents.
  • Industry Diversification: Industry diversification is the strategy of expanding into new businesses or sectors to reduce reliance on a single market. For Busan, diversifying its industrial base is deemed vital for economic revitalization and attracting young talent.
  • AI Literacy: AI literacy refers to the understanding and ability to utilize artificial intelligence technologies effectively. Incorporating AI literacy into education is crucial for preparing youth in Busan for the future job market shaped by technological advancements.
  • Public-Private Partnerships: Public-private partnerships (PPP) involve collaboration between government entities and private sector companies to deliver services or projects. These partnerships are essential in Busan's strategy to foster job creation and innovation while addressing youth outmigration.
  • Vibrant Urban Environment: A vibrant urban environment is characterized by a lively atmosphere, cultural engagements, and active community participation. Enhancing Busan's urban environment through improved amenities and cultural offerings is key to attracting and retaining youth.

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