The Bank of Korea has published an issue note finding that Korea’s youth employment decline was heavily concentrated in industries with high artificial intelligence exposure. Between June 2022 and June 2026, employment among people aged 15-29 fell by 285,000, with high-exposure industries accounting for 268,000, or 94%, of the decline. Employment among workers in their 50s continued to rise in the same industries, indicating a shift toward experienced workers. The analysis does not establish that AI caused the decline, which may also reflect post-pandemic adjustments, experienced-hire preferences, weaker in-house training and remote work. Youth employment fell more in industries where AI is used for automation, while no comparable pattern emerged where AI augments human work. Since November 2022, unemployment among young people with at least a bachelor’s degree averaged 7%, compared with 5.4% among those without one. The contraction also reflected increased employment exits as well as weaker hiring, with average monthly outflows from high-AI-exposure industries rising 32% between the pre-pandemic and recent four-year periods. The note calls for rebuilding career pathways rather than preserving existing entry-level roles. Proposed priorities include work-based apprenticeships, support for firms’ training and mentoring costs, and a review of whether policy incentives appropriately balance investment in technology and human capital.
2026-09-03Bank of Korea
Bank of Korea finds AI-exposed industries accounted for 94% of youth employment decline
The Bank of Korea found that high-AI-exposure industries accounted for 268,000, or 94%, of Korea’s 285,000 decline in youth employment between June 2022 and June 2026. Losses were greater where AI was used for automation, while unemployment and employment exits also rose among highly exposed young workers. The note recommends apprenticeships, stronger support for workplace training and a better balance between technology and human capital incentives.