South Korea to invest $31 billion next year to restore youth 'growth ladder'

South Korea is set to significantly increase its investment in youth support, allocating 43.3 trillion won (approximately $31 billion) for the upcoming year. This represents a 54% surge from the current year's 28.2 trillion won and is part of a comprehensive strategy to restore the 'growth ladder' for young people facing job shortages and limited opportunities for income and asset accumulation.

The government unveiled its 'Comprehensive Investment Promotion Strategy for Youth Growth Stages' at the 'Youth Budget Unboxing 2027' event. The strategy is divided into three main pillars: restoring the growth ladder through jobs and entrepreneurship; mitigating disparities at the starting line via education, housing, and assets; and enhancing quality of life through living and cultural support. This lifecycle-based approach aims to provide tailored financial, tax, and housing assistance.

In the employment sector, the K-New Deal Academy, focused on developing job-specific skills, will see its participant numbers expand from 10,000 to 50,000 next year. A new 'First Career Project' will offer field training opportunities to 60,000 university students. Companies hiring graduates from government-supported programs will receive hiring incentives: 7.2 million won annually for small and medium-sized enterprises and 3.6 million won for large regional corporations. The plan also includes creating 200,000 private and public jobs by 2030 and launching the 'Youth Startup Package' to support technology-based startups.

Education and housing support are also being enhanced. University students will receive support for joint AI model subscriptions, and national universities will offer full scholarships in all departments except medicine and pharmacy. For housing, the monthly rent tax credit rate for young people will be increased to 17%, higher than the general rate of 15%. Furthermore, over 50% of the planned universal public rental housing will be supplied to young individuals. To foster early asset formation, an 'Our Child Independence Fund' will be introduced, where the government matches parental contributions. Low-income households (below 50% of median income) will receive an annual government contribution of 1.2 million won, regardless of parental contributions.