IDB: Transformation: Skills for Productivity
Economic Development and TVET
in South Korea
Lima Peru, June 12, 2014
Jisun Chung
Korea Research Institute for Vocational Education and Training
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Changes in GDP per Capita since 1960s
26,204
26000
24000
($)
21,529
22000
20000
18000
16000
14000
12000
11,471
10000
8000
6000
4000
2000
0
105
‘60
‘65
‘70
‘75
‘80
‘85
‘90
‘95
‘00
‘05
‘10
‘11
‘13
‘14
 1965-1995: 100-times increase in GDP per capita only in 30 years.
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[Success Factors of the Korean Economy]
1. Government Leadership in Economic Growth
Implementing a series of “Five-year Economic Development
Plans” 1st –7th : 1962 – 1996
2. Success of Private Sector
The major domestic companies (Samsung, Hyundai, Kia,
LG, Daewoo, POSCO .….) lead national economy
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[Success Factors of the Korean Economy]
3. Human Resources Development
<chart> Pop.
attained at least upper secondary ed
(2013)
100
80
60
40
25-34 year-olds
20
0
55-64 years-olds
Indigenous Enthusiasm for Education and HRD
dichotomy between old and new generations
4
Shift in Industries (1960s)
Before 1960
◁ Traditionally agricultural
society
-Government planned to shift
from agriculture to
manufacturing which was
more value-added.
(strategic industry)
From 1960s
◀Industrialization
◀Manufacturing industries
- general merchandise
- light industries
(e.g. textiles, footwear, wig)
◀ Labor Intensive exportoriented industries
- with comparative
advantage of cheap and
abundant labor
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Policies of Vocational Education and Training
supporting Economic Development
• Construction of infrastructure of vocational education
 Primary education for six years has been compulsory to
support industrialization.
 Public training centers were established.
 Vocational Training Act in 1967
• Cultural Factors: People’s indigenous enthusiasm for
education and work (Confucian culture)
- diligence: work hard for family, society, and country
- aspiration for upward social mobility: Skills development
(education and training) was mechanism for social upward
mobility.
6
1970s~1980s: Transitioned to
Heavy and Chemical Industries
petro-chemical, shipbuilding, automobiles,
electric and electronic industries
◆Skilled workers and technicians were needed
- expansion of vocational high schools,
vocational colleges
- Increase in in-house training system
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1980s~1990s:
Technology-intensive Industries
• Shifted to technology-intensive industries
– Demand for high-skilled, multi-skilled technicians
– Expansion of 2-year vocational colleges,
polytechnic universities, and 4-year universities
– Increase in role of public training organization and
qualification authorization (HRD Korea)
• Employment Insurance System was established in
1995. (Social Safety Net: for the unemployed as well as
employed to be trained)
8
Knowledge-based Economy In 2000s
• IT, BT, NT, CT, ST, ET… knowledge intensive, more
highly skilled workers were needed
• Labor cost raised high with increase of national
income and more educational achievement.
- Low labor cost was not a comparative advantage any more :
many developing countries retain lower waged labor-force
• Then high skills and knowledge are more important
to develop competitiveness.
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Brief History of Skills Development Policies in
Korea: Industry and Export Profile
Source : Bank of Korea
Key Skills Development Policies
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Contribution of Skills Development
 Timely supply of skilled workforce in step with the industrial development
stages has contributed to economic development.
 SD, heavily represented by government-led public training in the initial stage,
is in transition to market-led paradigm marked by voluntary participation
and government support.
Labor-intensive light industries (cheap labor=comparative advantage)
Technology-intensive industries (skilled labor)
Knowledge Industry (High-skills/ High-tech)
Labor-intensive
Technology
Knowledge-based
90
70
50
30
10
-10
1970
1975
Primary
1980
1990
1995
Lower Secondary
2000
2003
Upper Secondary
2010
2012
Tertiary
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Muchas Gracias!
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