Samsung Electronics and SK Hynix have announced plans to develop a regional semiconductor cluster, highlighting how large corporations' investments in local areas can create quality jobs and attract new residents. This significant investment initiative could be a breakthrough in overcoming the crisis of regional decline.
According to the Bank of Korea and industry sources, the population of Asan, South Chungcheong Province, increased from 265,000 in 2010 to 355,000 in 2024, a rise of 90,000 (approximately 34%). This growth is attributed to Samsung Display's announcement of a 13.1 trillion won investment plan in 2019.
In 2023, Hyundai Motor selected Asan as the site for its first dedicated electric vehicle factory. The company plans to invest 24 trillion won by 2030 to achieve a top-three position in the global electric vehicle market.
In Gwangyang, South Jeolla Province, POSCO International and Hanwha Ocean Ecotech are investing 1.2 trillion won to build an LNG combined heat and power plant and an eco-friendly ship parts factory, contributing to a population increase from 146,000 in 2010 to 155,000 in 2024.
The structure of corporate investments leading to quality job creation has been observed internationally. After TSMC built a semiconductor production facility in Kaohsiung, Taiwan, in 2022, the area's unemployment rate fell to 3.2% in the second half of last year, the lowest among Taiwan's six metropolitan areas.
The Bank of Korea noted that "regions with high economic dynamism, which indicates job creation and destruction, see a greater increase in real median wages when corporate investments flow in." Notably, the positive effect of economic dynamism on median wages was stronger in non-capital regions, with increases of 0.05% in the southeastern region and 0.04% in the central and southwestern regions.
When the share of new local jobs increases by 1 percentage point, the change rate of the regional manufacturing production index rises by 3.35 percentage points, and the change rate of regional exports increases by 9.75 percentage points.
Professor Kim Dae-jong of Sejong University stated, "It is urgent to implement policies that support the establishment of companies in the region after attracting large corporate investments. A paradigm shift in industrial policy is needed, such as introducing a 'mega sandbox' that significantly relaxes regulations for specific regions."
* This article has been translated by AI.
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