Since the South Korean government announced the newborn priority housing initiative in November last year, fertility centers have seen a notable increase in visits from women in their 30s and 40s. The policy prioritizes the provision of 30,000 public and private apartments annually to households that conceive or give birth within two years. Following the announcement, the number of women seeking to become pregnant has risen by about 30%. The special supply system has particularly impacted couples who were previously hesitant to have children due to the financial burdens of homeownership.
The Anti-Corruption and Civil Rights Commission recently cited an example where Booyoung Group paid 100 million won in childbirth support to its employees and surveyed the public on whether adopting such a policy could help overcome the country’s low birth rate. As a result, 63% of participants believe this model would motivate them to have children, and 64% agreed that the financial burden on the state is necessary to address the low birth rate crisis. Based on last year’s figures, direct cash payments of 100 million won per child would require an annual budget of 23 trillion won.
These examples underline a clear message: Current piecemeal policies to combat low birth rates are ineffective. Despite the government’s investment of 280 trillion won from 2006 to 2021 to address low birth rates, the birth rate plummeted to 0.72 last year. This indicates the need for a radically different and bold approach, similar to the call to consolidate the myriad financial and tax support projects into a unified “family allowance.”
South Korea faces the dire risk of national collapse due to its plummeting birth rates. Lee Jae-myung, leader of the Democratic Party of Korea, proposed during the recent general election to allocate 13 trillion won to provide 250,000 won in support per person. Nearly 14 trillion won is being spent on constructing a new airport on Gadeok Island, and tens of trillions of won are spent inefficiently each year on local education grants. By cutting back on just a few of these expenditures, the budget could be reallocated for bold policies like special housing supply for newborns or adopting the Booyoung model. It is time for drastic measures that will truly surprise the younger generation.
