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The Effect of Future Population Change on the Size of Labor Input
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장래 인구변화가 노동투입 규모에 미치는 영향

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Type
Academic journal
Author
Lee Chulhee (서울대학교)
Journal
한국노동경제학회 노동경제논집 노동경제논집 제45권 제2호 KCI Accredited Journals
Published
2022.6
Pages
37 - 68 (32page)

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The Effect of Future Population Change on the Size of Labor Input
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This study estimated how future population change will affect the size of quality-adjusted labor input in Korea. The results show that the pace of long-run decrease of the economically-active population (EAP) will be much slower than that of the working-age population. Furthermore, the productivity-adjusted labor input, computed with using genderㆍageㆍeducation-specific hourly wages, is projected to decline more slowly than EAP. For example, the EAP and the productivity-adjusted labor input are expected to diminish to 88.6% and 93.6%, respectively, of the current levels by 2040. This indicates that the effect of aging of the labor force will be dominated by the effect of human capital improvement of workers. The simulation results suggest that increase in labor force participation of women and/or of aged persons as well as relative improvement of female productivity will be helpful for coping with potential decline of the labor force caused by population change. Since it is unlikely that overall labor shortage will occur within the next 10 to 15 years, the present labor policies in response to population change should focus more on long-term effectiveness rather than short-term outcomes.

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