Challenges in Human Resource

Development in Asian Countries

2002. 11

Sangwon Ko
sangwon@kisdi.re.kr

m‘”‡ƒBkˆ‘”ƒ–‹‘Bu‘…‹‡–›Bf‡˜‡Ž‘’‡–Bk•–‹–—–‡

New Challenges in HRD

• What is HRD ? Activities of education, initial

training, continuous training, and lifelong
learning that develop and maintain individuals’
employablity and productivity over a lifetime
• Drivers of changes: Globalization, Skill-biased
Technological Change, New work organization(IT
& decentralization)
• Proactive function and Remedial function of HRD

Source: ILO, Training for employment: Social inclusion, productivity,and youth

employment, http://www.ilo/org/public/english/standards/relm/ilc/ilc88/rep-v.htm

Identifying Trends Of Upskilling

•Unemployment rate of the unskilled increases (European

Countries)
• Wage premium of the skilled increases(US)
• Inequality of income distribution increases

In case of Korea, however, unemployment rate of the

educated has increased and educational wage differential
has narrowed even with skill-biased technological change.

1
 Consequence of Rapid expansion of university education
Due to the rapid expansion of university education during 1980’s, qualified workers poured into t
he labor market. The unemployment rate of the highly educated has been greater than the total
unemployment rate. As sudden external shock, the Asian financial crisis, hit the labor market in
last quarter of 1997, the unemployment of the uneducated started to increase much faster than
that of the educated. Since 1998, the unemployment rate of the highly educated has been lowe
r than that of less educated.

Y PW
Y PS
Y X PX X PX
X PV X PW X PZ

X PU
X XPS
X PS
W PW
W PY
W W PS
V P[ W PU
V PX
V PY V PS
V PW V PT
V UPZ
VPT V PS U P[ UPX U PX
U P[ U P[ U PY
UPT U
U UPV T PY TPX
T P[ T PX
T PX T PX TPW
T T PV
TPU
T T

R
ZR ZS ZT ZU ZV ZW ZX ZY ZZ Z[ [R ZS [T [U [V [W [X [Y [Z [[ RR RS

— ‡ ’ Ž‘ › ‡–B”ƒ–‡ — ‡ ’Ž‘›  ‡ –B”ƒ–‡B‘ ˆBŠ‹‰ ŠŽ›B‡ †— …ƒ–‡†

Source : National Statistical Office, Economically Active Population Survey, various years
4

Declining educational wage differentials in Korea

The educational expansion not only leads to a rise in the unemployment rate of the highly educated
but also to a drop in wage differentials by educational levels. Until the mid-1980’s the average wage
of college graduates was 2.3 times greater than that of high school graduates, and in 2000 the avera
ge wage of college graduates was only 1.5 times greater than that of high school graduates. The av
erage wage of junior college graduates, which was 1.5 times greater than that of high school graduat
es in 1980, dropped to only 1.03 times greater than that of high school graduates in 2000.

Change in Relative Average Wage by Educational Qualifications

T UR PR G
( Average Wage of High School Graduates = 1)
T SR PR G

S [R PR G

S YR PR G

S WR PR G

S UR PR G

S SR PR G

[R PR G

YR PR G

WR PR G
ZR ZS ZT ZU ZV ZW ZX ZY ZZ Z[ [R [S [T [U [V [W [X [Y [Z [[ RR

 ‹† † Ž‡ B•… Š‘ ‘ ŽB‰”ƒ†—ƒ –‡B‘ ”BŽ‡ •• Š ‹‰Š B•… Š ‘‘ ŽB‰”ƒ †—ƒ –‡ Œ—  ‹‘ ”B…‘ ŽŽ‡‰ ‡B‰”ƒ†— ƒ –‡ …‘ ŽŽ‡ ‰ ‡B‰”ƒ† — ƒ–‡

Source: Ministry of Labor, Survey Report on Wage Structure, Various Years

5

Population Statistics for selected Asian Countries(2000)

Jw ‹–\BSRRRB’‡”•‘•K
URRNRRR
SNTYWNSUU
r ‘’—Žƒ–‹‘BJTRRRK
TWRNRRR
TSTNR[T
TRRNRRR

SWRNRRR STYNR[X

SRRNRRR YZNSUY YXNXWU

XTNZRX
VYNRRZ
WRNRRR
TTNTYY TTNTSZ
XNZXR VNRSZ
R
ƒ
‹ ‹ƒ 
ƒ  •
‡ †

ƒ
‡
‡ ‡
•
‹ ƒ
‹ ‰
 ‡
”
• ’ ƒ  ƒ ” ‡ƒ ‹
 ’ • ‘ ‘
Š ‡ ƒl p
B
– ‹
’ Ž
‹ ‘ ™ƒ
‹‹ ›
ƒ m ’
e  ‡ ’ ƒ m Šƒ v Ž B ƒ
‘† ‹ ‹
Ž Š e v ƒ ‰ ‰
x ‹ v  
‹
k Š o ‘
j u
r

Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC
6

2
Economically Active Population and Labor Force Participation Rate
For Selected Asian Countries

(U n it: 1 0 0 0 p e rs o n s) (U n it: % )
1 2 0 ,0 0 0 1 00
7 1 1 ,8 3 0 Ec on o m ic a lly Ac tive P o p u la tio n
la b o r fo rc e p a rtic ip a tion ra te
1 0 0 ,0 0 0 9 5 ,7 9 3 7 7 .2
7 2 .7 80
6 8 .6
6 7 .9
6 4 .3
6 2 .5 6 0 .8 6 1 .7 6 0 .7
8 0 ,0 0 0
5 7 .7
6 7 ,6 8 0 60
5 6 .5
6 0 ,0 0 0

40
4 0 ,0 0 0 3 3 ,7 9 9
3 0 ,9 0 8 2 9,5 25
22 ,18 1
20
2 0 ,0 0 0
9 ,7 8 4 9 ,6 1 6
3 ,3 8 3 2 ,1 9 3
0 0
ƒ ƒ
‹  † •  ƒ  ƒ
‹ ‰ ‡
”

‹ • ƒ  ‡ ƒ ‡
” ‡ƒ™ ‹ •  ‘
Š ‡ ’ ƒ
Ž 
‹ ‘ •‹ ‡ › ‘ ’
ƒ ‹ p ‡ m
‹’
e  ’ B
– m ƒ B ƒ
‘ l ƒ ’
‹ ‡ ƒ Ž ‰ ‰
† Š
v Ž
‹ ‹ ‹v ƒ ƒ  

k Š x Š
e v o ‘ ‹
r j u

Note : Capable Age : 15+ ( China 16+ )

Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC
7

Employment by Industry for Selected Asian Countries

(unit: 1000 persons, %)

c ‰ ”‹… — Ž–— ”‡ Bh ‘ ”‡ •–”›BH Bh ‹• Š ‡ ”› o ‹ ‹ ‰BH Bo ƒ  — ˆƒ … –— ”‹ ‰ u Pq Pe PBH Bu ‡”˜‹… ‡ •

UYNRRR UUNRRS YSSNWRR ZZNZSY TYNYYW [NUTT TSNUXT [NV[S XVNVZR UNTSV TNR[W
SRRG
TSP[
ZRG UXPX VSPR VUPR
[PW WTPT WZPW XVPS
YRPR YVPU
XRG Y[PR
SVPX ST PS Z[PT
SUPZ
SRPV
VRG
XZPX
TUPS
VZPZ VX P[ VUPT TZPS
TRG UYPV S[PY
TRPX
SZPV SRPW TRPZ
SRPU YPZ WPS RPU RPT
RG
 † • ƒ‹
ƒ ƒ ‹ƒ ‡ ‹  ‰ ‡”
ƒ  ‡ 
•
‹ ”‡ • •ƒ
‡
‡
’
ƒ  ‘
p ƒ
Ž ‹ ›
Š ‘ ‡ ™ ‹ ’ ‘ ’
B
– ‹ ’ Žƒ
e m ‹‹ ƒ ƒ mB ƒ
‡ ƒ ‘ Šƒ v l
‹ Š ‹’Ž ƒ
† e
v ‰ ‰
x v Š‹ o k ‘ ‹
r j u
Note : Capable Age : 15+ ( Malaysia 15~64, Thailand 13+, China Vietnam, ?)
Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC
8

Availability of Skilled Labor for Selected Asian Countries

rŠ ‹ŽŽ‹’’ ‹‡•BJBSK YP[UV

u ‹‰ƒ’‘ ”‡BJBVK YPXYT

lƒ’ƒ BJSRK YPURZ

h‹Žƒ† BJSXK YPRUY

vƒ‹™ ƒ BJSYK
eŠ‹‡•‡Bvƒ‹’‡‹
XPZZU

j ‘ ‰Bm‘‰ BJTUK XPWYS

m‘”‡ƒ BJTWK XPUXX

o ƒŽƒ›•‹ƒ BJURK XPU

vŠƒ‹Žƒ† BJUZK WPZVX

k†‘‡•‹ƒ BJVTK WPTXY

…Š‹ƒ BJVWK VP[WX Jw ‹–\Br‘‹–K

R S T U V W X Y Z [ SR

Note : ( ) Rank
Source: IMD, The world Competitiveness Yearbook 2001
9

3
 Enrollment Ratios for Secondary and Tertiary Education

Jw  ‹–\BG K
SRR
[[PR [ZPX [YPV u ‡…‘ †Bn‡˜‡Ž vŠ‹”†Bn‡˜‡Ž

ZR
XZPR XYPY YVPR
YRPR X[PR
XR
WZPZ WZ PZ WYPR WXPR
VRPW UZPW
VR VTPU
T[PR
TXPR TTPS

TR
S SPY SSPU
XPS XP[

R
‡ ‹  ƒ ‡
” ƒ ‰ • ƒ
‹  † ƒ
‹
• ƒ‡
‡
ƒ ‡
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
‹  ‡ • ƒ  •
‹™’‹ ’ ‘ ’ Š ‘ 
‹ › p ƒ
Ž
‹ ‡
‹ ƒ m
B ’ ƒ B
– 
Š ƒƒv l m ƒ
‰
e ‰ ’ Ž
ƒ ‡ ƒ ‘
ev   ‹
Ž
‹ ‹ Š
v †
‹ ‘ Š o x 
k
u j r

Source: Korea National Statistical Office, 2002, Main Statistical Indicators in APEC
10

Industrial restructuring and the education and Training System

The education and training system need to evolve in unison with industrial
restructuring. Korea’s experience can shed light on other Asian countries.
Evolution of education and training system of Korea
More responsive
responsive education
education and
Training System

Qualitative Improvement of
Training and Education
Expansion of Universities - Continue to Increase support
and vocational Junior for university research(BK21)
Colleges - reinforce vertical and
horizontal linkage in
Expansion of - Research funding had
vocational education along
technical high been substantially
with school-industry
school increased
- Special funding for partnership at the local level
-Restructuring toward skill - Foster Institutional diversity
intensive Industries selected Graduate
through autonomous
- Emphasis is given to Schools
decision making of schools
producing highly educated - Evaluation of
- From light Industry to workers Universities Is linked
Heavy and Chemical - The number of university with funding
Industry degrees awarded annually - The number of
- Specialized technical high more than tripled during the technical high School
school is expanded (I.e., 1980s. had been doubled .
machinery)
1970s 1980s 1990s 2000

11

Challenges to the Korean education system

• Two thirds of educational expenditure comes from private source and private
schools constitutes 90% of the tertiary level educational institutions
- However, type of schools, student admission, curriculum, teacher hiring are
strictly regulated by central government

• Gender bias is deeply embedded • Informal, vocational and distance

in Korean culture and tradition. Deregulation & education system are not integrated
38% of tertiary enrolment: female decentralization with formal one.
• Need qualitative improvement to • ICTs are not fully exploited in areas
meet the new skill requirements such as distance learning and cyber
• The linkage between industry and universities.
university is weak. Gender,
relevance, Lifelong • Recognition and rewards for
• Lack of sound incentive system
Challenges to the education improved skills in workplace are
for teachers : seniority-based pay &
Korean Education necessary. Performance-based pay
• Inbreeding is prevalent in hiring quality
• Access to knowledge and
professors. System
information for all, especially for the
• Government mandated criteria for
poor need to be stressed.
setting up campus deter foreign • New initiatives : credit bank system
institutions to provide educational self-study
service in Korea.
Diversification

• Korean Universities operates in a “department store” style, offering similar curriculum.

• Local universities fails to meet local needs.
• Vocational institutions and general secondary schools are even less diversified than
universities.
• Growing needs for inter or multi-disciplinary programs

Source: The World Bank and OECD(2000) Korea and the Knowledge-based Economy: Making the Transition
12

4
 Quantity OR Quality
There are three ways to adjust the supply to correct mismatches between
demand and supply; a)shift supply curve vertically, b)shift supply curve
horizontally, c)shift supply curve both vertically and horizontally. Shifting
supply curve upward can be called as a quantity increasing policy and
shifting supply curve to the right can be called as a quality improving policy.

Diagrammatic model of labor demand and supply Policy options of adjusting supply of labor

supply
demand

Quality Quality Quality

a) quantity increasing policy b)quality improving policy

13

Categorization of Policy Alternatives in

Human Resource Development

• Providing a basic education

• Analyzing the labor market to allow sound forecasting of trends and needs in
HRD
• Increasing the supply and enhancing the quality of managers, scientists,
entrepreneurs, and teachers
• Reducing skills deficiencies and unemployment by training program
• Improving the quality of curricula, teaching method and instructional material
• Increasing opportunities for people seeking to gain skills
• Preparing organization and individuals to remain productive in the face of rapid
economic and technological change
• Promoting HRD toward the liberalization of trade and investment

Source: ECOTECH ACTION PLAN(2002), http://www.apec-ecotech.org

14