The influx of foreign workers has had a limited impact on overall domestic employment, but it has shown some effects in simple labor positions, according to a recent analysis. In the manufacturing sector, while domestic employment initially increased alongside the arrival of foreign workers, there is now a possibility that some domestic workers may be replaced over time.
On September 26, the Korea Employment Information Service released a report titled "In-Depth Analysis of Immigrant Labor Market by Characteristics." The research team utilized employment insurance database (DB) data to compare and analyze changes in domestic employment between businesses that hired foreign workers and similar businesses that did not.
The analysis found no significant difference in domestic employment at businesses that employed foreign workers compared to the control group. This suggests that the influx of foreign labor does not directly lead to a decrease in domestic jobs. However, when broken down by tenure, occupation, and industry, some groups did show a reduction in employment.
For domestic workers with less than one year of tenure, employment dropped by 18.8% one month after the hiring of foreign workers. The researchers suggested that this may indicate a short-term replacement of domestic jobs by foreign workers. After this initial period, a consistent downward trend in employment was not observed.
In terms of occupation, the replacement effect was particularly evident in simple labor jobs. Following the hiring of foreign workers, domestic employment in simple labor roles decreased by an average of approximately 5.3% over the entire analysis period. While there was no significant impact in the first one to two months after the influx, the reduction in domestic employment became more pronounced thereafter.
In the manufacturing sector, a different trend emerged. After the hiring of foreign workers, domestic employment increased by an average of 3.3% over the analysis period. Initially, the influx of foreign labor led to a complementary relationship, as domestic workers were added due to a lack of skills among foreign workers. However, for domestic workers with between one and three years of tenure, there was an average decrease of 4.7%. The researchers explained that as the skill level of foreign workers increased, it is possible that some domestic workers were gradually replaced or their roles were reassigned after a certain period.
Kim Sae-bom, a researcher at the Korea Employment Information Service, stated, "It is necessary to comprehensively consider the industrial structure, labor market supply and demand situation, the interrelationship with other foreign labor systems, and the impact on domestic jobs when operating the general employment permit system and setting quotas for its introduction."
She added, "The impact of foreign employment on domestic jobs can vary depending on demographic structure and labor market conditions, so continuous observation is needed. Additionally, job transition training should be provided for domestic workers in occupations or roles that may be affected."
* This article has been translated by AI.
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