Work-Life Balance Initiative Boosts Employee Satisfaction in South Korea

In a society that values work-life balance, a culture of taking time off has become an important welfare asset for companies. This shift has been particularly significant in small and medium-sized enterprises (SMEs) and small business sectors, where the Ministry of Culture, Sports and Tourism and the Korea Tourism Organization have played a crucial role through their Employee Vacation Support Program.

According to a survey by the Korea Employers Federation released in July, the average vacation days for large companies this summer was 4.6 days, while SMEs averaged 3.7 days. The percentage of companies offering summer vacation bonuses has decreased to 53% from 54% last year, even as the demand for time off has grown. A vacation survey conducted by the Ministry in December revealed that the annual leave utilization rate reached 79.4%, the highest since the survey began in 2018. Travel accounted for 35% of the reasons for taking leave, maintaining the highest rate since 2022.

The Employee Vacation Support Program has gradually changed the vacation culture over the past eight years, bridging the gap between limited welfare budgets and increased vacation demand. As of August 19 this year, 12,7856 employees from 11,873 companies participated, surpassing last year's total of 120,740.

The Employee Vacation Support Program began in 2014 in response to growing social demands for improved vacation culture and conditions. The program, modeled after the Korean-style check vacation system, was piloted by the Korea Tourism Organization with 2,526 employees from 180 SMEs participating. The pilot program transitioned to a full-scale initiative in 2018, aimed at improving the poor vacation culture and encouraging employees to take time off, while also boosting domestic travel.

The program operates on a cost-sharing model where employees contribute 200,000 won, and both the company and the government provide 100,000 won each. The total of 400,000 won is returned to employees in the form of credits that can be used to purchase domestic travel products from a dedicated online store, which offers around 270,000 items including accommodations, transportation, and admission tickets. Companies often cite cost savings (48.7%) as a primary reason for participation.

Since the new government took office last year, the program has been expanded. The national policy initiative to create a tourism environment accessible to all includes expanding employee vacation opportunities. This year, the recruitment target has increased from 100,000 to 145,000 due to supplementary budget allocations.

From 2018 to last year, 790,000 employees and over 80,000 companies participated in the Employee Vacation Support Program. This year, 70,522 employees from medium-sized companies (55.2%) participated, followed by 25,383 from small businesses (19.9%) and 16,810 from micro-enterprises (13.1%). A total of 408 organizations have participated continuously since 2018.

During this period, participating employees spent approximately 724.77 billion won on domestic tourism. According to last year's performance analysis, the average spending per participant was 954,837 won, which includes the 400,000 won credit and an additional 554,837 won from their own funds, marking a 4.5% increase from the previous year. The government support of 100,000 won was leveraged 9.5 times. Notably, 97% of participants spent more than 300,000 won of their credits, with an average credit usage of 394,403 won.

Additionally, the program has generated new travel demand. A survey of 1,014 participating employees by the Korea Tourism Organization found that 53.3% took trips they had not originally planned. Among new participants, 83.7% reported an increase in domestic travel frequency, and 60.7% noted higher travel expenses. There has also been a positive change in annual leave usage, with a utilization rate of 87.4% among participants, compared to 79.4% for the general workforce. The average number of trips taken was 2.4, with an average duration of 4.3 days.

In a survey of 300 participating companies and 1,014 employees conducted last year, overall satisfaction rates were 82.0% and 81.0%, respectively. The intention to participate again was the same for both groups at 86.0%. Notably, satisfaction among returning companies was higher at 87.8%, with a re-participation intention of 92.3%, exceeding new participants by 14.7 and 15.8 percentage points, respectively.

Companies cited reasons for participation as follows: cost savings (48.7%), employee demand (45.3%), and a high preference for travel-related benefits (42.0%). Employees primarily mentioned reduced financial burden (90.1%) as their reason for participation. Companies identified the benefits of participation as improved employee satisfaction (80.0%), enhanced welfare systems (72.0%), and increased motivation (71.7%). Some also noted benefits such as securing talent (38.7%) and reduced turnover rates (35.0%).

A co-growth support program, which allows public institutions, private companies, and local governments to cover the contributions of SME employees, has been in operation since 2020. The number of participating companies has grown from 163 companies and 1,650 employees in its first year to 3,079 companies and 20,698 employees last year. The Korea Tourism Organization conducted 30 promotions from January to August this year, a 67% increase from 18 during the same period last year, and provided additional points to 44,476 local employees as of August 31.

The Korea Tourism Organization will hold the '2026 Employee Vacation Support Program Results Sharing Event' on October 10 at Signiel Seoul. Over 200 representatives from participating companies, responsible personnel, and related organizations will attend. The event will expand from a workshop focused on awards and best practices to a networking and results-sharing format.

Winning companies were selected from 92 applicants following evaluations conducted on July 29. The Minister of Culture, Sports and Tourism Award will be presented to Big Tech Plus Co., Ltd. and Good Runner Company. The President of the Korea Tourism Organization Award will go to Human Metrics Co., Ltd., Service Co., Ltd., Easy Care Tech Co., Ltd., and Soha Aram Ilteo. The Co-Growth Award will be given to Gangwon Land Co., Ltd. and the Korea Real Estate Agency. Five organizations will receive appreciation plaques. Able Co., Ltd., recognized for its long-term participation over the past four years, will receive the Companion Giant Award, while Gyeryong Construction Industry Co., Ltd., noted for its excellent participation outside the capital region this year, will receive the Local Love Award. A-Pact Co., Ltd., recognized for its outstanding new participation this year, will receive the Vacation Seed Award. IBK Industrial Bank and the Construction Workers Mutual Aid Association, which had the top two budgets for the co-growth model last year, will also receive appreciation plaques.

The Korea Tourism Organization is preparing to refine the program as it approaches its 10th year next year. Kwak Jae-yeon, head of the National Tourism Support Team at the Korea Tourism Organization, stated, "Next year, we plan to change the name to 'Laborer Vacation Support Program' to align with the government's new direction. We also aim to expand the program to include various job types, reducing support gaps and developing effective vacation support systems that reflect on-site demands so that more workers can enjoy their vacations."

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