High pay and solid job security are conditions any worker would want. But it is difficult to guarantee both in every job, all the time. A hard trade-off exists in the labor market as well.
The compensation a worker receives includes more than payment for the content of the work and the hours spent. It also contains a risk premium reflecting how much market volatility and the threat of dismissal the individual bears. Core technical staff at Big Tech firms earning over 100 million won (about $70,000) a year, for instance, must worry about their positions the moment performance turns down, while civil servants on relatively lower pay enjoy firmly guaranteed tenure to retirement age. It is a basic principle of a market economy that those who take on risk are compensated more, while those who gain stability receive relatively less.
The problem arises when this balance breaks down. South Korea's dual labor market is a prime example. The primary labor market, centered on permanent employees at large companies, enjoys both generous compensation and strong job security, backed by thick employment protection laws and high bargaining power. The secondary labor market, centered on smaller firms and non-regular workers — temporary and contract workers — combines low wages with job insecurity. As of 2025, permanent employees at large companies accounted for only about 12% of all wage workers, yet their wages were roughly 1.7 times and their job tenure roughly 2.1 times those of the remaining 88% of workers. The gap in social insurance coverage is also clear. Running counter to the market's trade-off, the structure places groups facing greater job insecurity in a position of lower wages and a weaker social safety net.
The burden of this dual structure falls mainly on young adults taking their first steps into the labor market and on vulnerable groups. The higher the cost of maintaining jobs that combine high wages with strong employment protection, the more cautious companies become about new hiring. Labor costs keep rising with length of service, and once hired, staff are difficult to adjust. As a result, the door into quality jobs narrows, and opportunities to move from smaller firms and non-regular work to large companies and permanent positions also shrink. Young people who fail to enter good jobs put off employment or give up the search altogether, which becomes a factor sapping vitality from the labor market as a whole.
In this way, concentrating on preserving high compensation and job security in particular jobs can end up constraining job creation and mobility within the labor market. Rather than focusing on maintaining individual jobs, policy direction must now shift so that workers can secure stability even as they move between jobs. The answer is flexicurity. Flexicurity is an approach that guarantees companies the flexibility to respond to changing conditions while strengthening reemployment support and the social safety net for workers, raising employment security across the labor market as a whole rather than in specific jobs. Realizing this requires institutional reform to narrow gaps within the labor market. The starting point is easing excessive protection for permanent employees and establishing a pay system that rewards the value of work and performance rather than seniority. Only then can workers move to jobs that match their capabilities, unconstrained by company size or employment type. Building on the flexibility thus secured, companies must respond to industrial change and continue creating quality jobs.
At the same time, the state must strengthen the social safety net so that workers' lives do not collapse during job loss and career transitions. The core is replacing income during unemployment through unemployment benefits and building the skills needed for new jobs through vocational training that reflects rapidly shifting industrial demand. Only when employment services linking job seekers and companies are added does the safety net become a springboard for reemployment. Employment risk must be shared by society rather than borne by companies or individuals alone, so that workers can accept change as an opportunity rather than a threat.
No one can be faulted for wanting greater compensation and firm job security. But if the trade-off between the two is ignored and only existing benefits in some jobs are pushed higher, corporate hiring and investment will contract and opportunities for future generations may shrink as well. Compensation must now correspond to performance and responsibility, and employment security must go beyond protecting specific jobs to support movement into new ones. Guaranteeing companies the flexibility to respond to change, and workers the chance to get back on their feet after job loss — this is the path of flexicurity that Korea's labor market must take.