A government plan to extend unemployment benefits to young workers who quit their jobs voluntarily has run into a budget wall. With the item left out of next year's spending plan, the goal of launching the program in the second half of 2027 has also been thrown into doubt.
According to the Ministry of Employment and Labor on the 19th, a proposal to pay job-seeking benefits once in a lifetime to workers under 35 who leave their jobs voluntarily after a set period of employment was not included in the 2027 budget plan. Under the version that had been under review, recipients would have received 60% of their previous wages, up to 1 million won ($730) a month.
The government says it will draw up supplementary measures and then push again for a legal revision and budget allocation. But public hearings and other steps to build consensus have yet to begin, suggesting it will be some time before the program actually takes effect.
Fiscal conditions are also a constraint. The employment insurance fund posted a current-year deficit of 592 billion won ($432 million) in fiscal 2025, and the underlying deficit in the unemployment benefit account, excluding borrowings from the Public Capital Management Fund, reached 5.99 trillion won ($4.4 billion). Concerns that paying benefits to voluntary leavers would add to that burden, and that it could encourage workers to leave small and midsize companies, also weighed on the decision.
Two in Three Young Workers Who Quit Leave Within a Year
Early departures among the young adults the program is meant to help are already pronounced. Employment administration data from the Korea Employment Information Service show that of the 146,418 workers under 35 who quit voluntarily in the first half of this year, 97,437, or 66.5%, had been in their jobs for less than a year. The younger the worker, the higher the share of short tenures: 80.1% of those aged 20 to 24 left within a year, compared with 63.5% of those aged 25 to 29 and 55.2% of those aged 30 to 34. Young adults stay at their first job for an average of just one year and 6.8 months.
That is why critics argue that paying unemployment benefits for voluntary resignations would amount to the state underwriting early job changes. Online, comments such as "the state is handing it out, so you'd be a fool not to take it" have been spreading.
Questions of fairness toward young people who have yet to land a first job have also been raised. Experts say they share the goal of helping young adults try again, but question whether the existing unemployment benefit system is the right vehicle and call for a design that also accounts for fiscal stability.