Workforce Development in the Republic of Korea Kasumigaseki Building 8F About the Asian Development Bank Institute ADB’S Headquarters Is in Manila
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About the Asian Development Bank Institute About the Asian Development Bank The Asian Development Bank Institute (ADBI), located in Tokyo, is a subsidiary of the Asian Development Bank (ADB). It was established in December 1997 to respond to two needs of developing member countries: identification of effective development ADB aims to improve the welfare of the people in the Asia and Pacific region, strategies and improvement of the capacity for sound development management of agencies and organizations in developing particularly the nearly 1.9 billion who live on less than $2 a day. Despite many member countries. As a provider of knowledge for development and a training center, the Institute serves a region stretching success stories, the region remains home to two thirds of the world’s poor. from the Central Asian republics to the Pacific islands. ADB is a multilateral development finance institution owned by 67 members, 48 from the region and 19 from other parts of the globe. ADB’s vision is a ADBI carries out research and capacity building and training to help the people and governments of Asian and Pacific coun- 2265_workforce dev_policies.pdf 10/24/07 4:59:03 PM region free of poverty. Its mission is to help its developing member countries tries. The Institute aims to provide services with significant relevance to problems of development in these countries. In line with reduce poverty and improve their quality of life. this aim, the approach is demand-led; ADBI’s Capacity Building and Training (CBT) group seeks to respond to demand for sustainable, wide-reaching training of government officials in ADB’s developing member countries. ADB’s main instruments for helping its developing member countries are policy dialogue, loans, equity investments, guarantees, grants, and technical assistance. ADB’s annual lending volume is typically about $6 billion, with Asian Development Bank Institute technical assistance usually totaling about $180 million a year. Development in the Republic of Korea Workforce Kasumigaseki Building 8F About the Asian Development Bank Institute ADB’s headquarters is in Manila. It has 26 offices around the world and 3-2-5, Kasumigaseki, Chiyoda-ku more than 2,000 employees from over 50 countries. Tokyo 100-6008, Japan The Asian Development Bank Institute (ADBI), located in Tokyo, is a subsidiary www.adbi.org of the Asian Development Bank (ADB). It was established in December 1997 to Tel +81 3 3593 5500 respond to two needs of developing member countries: identification of Asian Development Bank Fax +81 3 3593 5571 effective development strategies and improvement of the capacity for sound 6 ADB Avenue, Mandaluyong City ISBN 978-4-89974-014-8 development management of agencies and organizations in developing 1550 Metro Manila, Philippines member countries. As a provider of knowledge for development and a training www.adb.org center, the Institute serves a region stretching from the Central Asian republics Publication Stock No. 100207 to the Pacific islands. ADBI carries out research and capacity building and training to help the people and governments of Asian and Pacific countries. The Institute aims to Workforce Development provide services with significant relevance to problems of development in these countries. In line with this aim, the approach is demand-led; ADBI’s Capacity Building and Training (CBT) group seeks to respond to demand for in the Republic of Korea sustainable, wide-reaching training of government officials in ADB’s developing member countries. Policies and Practices C M Y CM MY Policies and Practices CY Policies and Practices Policies Workforce Development in the Republic of Korea CMY K Asian Development Bank Institute Kasumigaseki Building 8F 3-2-5, Kasumigaseki, Chiyoda-ku Tokyo 100-6008, Japan www.adbi.org Tel +81 3 3593 5500 Fax +81 3 3593 5571 ISBN 978-4-89974-019-3 Printed in the Philippines Workforce Development in the Republic of Korea Policies and Practices Young-Hyun Lee Series Editor: Jeoung-Keun Lee, Director, Capacity Building and Training, ADBI Author: Yong-Hyun Lee, Senior Research Fellow, Korea Research Institute for Vocational Education and Training (KRIVET), Seoul Published by Asian Development Bank Institute, 2007 ISBN: 978-4-89974-019-3 Asian Development Bank Institute (ADBI) encourages the use of the material presented herein, with appropriate credit given to ADBI. Please address inquires for copies to: Librarian Asian Development Bank Institute Kasumigaseki Building 8F 3-2-5 Kasumigaseki Chiyoda-ku, Tokyo 100-6008 Japan The views expressed in this report are the views of the author and do not necessarily reflect the views or policies of the Asian Development Bank Institute (ADBI), the Asian Development Bank (ADB), or its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms. Preface The strong performance of the Korean economy during the last four decades has been widely recognized. Korea entered the early 1960s as a typical labor-supply economy with scarce resources. During that decade, unskilled and semi-skilled workers were mobilized into manufacturing industries such as textiles, footwear, and garments. During the 1970s, the government embarked upon a radical policy of economic structural transition towards the development of heavy chemical industries. By the 2000s, a shift towards more technologically advanced products was underway, and high- tech and service industries were able to compete successfully with industries of more developed economies. It is noteworthy that workforce development in particular has contributed to this economic restructuring and the high economic growth rate that Korea has enjoyed during this period. Workforce development can of course be attributed to a number of factors including government policies, the personal efforts and commitment of the Korean people, and the human resource management of enterprises. However, in this work I focus on the role of the government, which has been pivotal in the process of the rapid industrialization of the Korean economy that has taken place in the post-Korean war era. This report focuses on Korea’s education and training policy during the 40 years since the founding of the government of the Republic of Korea. In the early 1960s, the Korean government established economic growth as its primary goal and began to mobilize the nation’s resources towards this end. Since then, it has restructured the education and training system in order to supply a more highly skilled workforce required by changing industrial demands. This report begins by examining the economy and the labor market as they relate to workforce development. Section 2 discusses the education system–and especially the all important screening process within the system that determines which children with which particular ability levels are channeled into which type of schools. The next two sections present a detailed analysis of the two main types of workforce development: policies and practices of vocational education and vocational training. Section 5 focuses on training and learning in enterprises, and individual cases of large firms and good practices of lifelong learning companies are presented. The qualification system and vocational skill testing system are dealt with in some detail in Section 6. The last section briefly describes some of the labor market challenges that the Korean economy is currently facing, proposes future policy directions and outlines some of the tasks confronting workforce development with a view to revamping the vocational education and training system. The major data source of the report is government statistics, while interviews with government officials were also conducted to obtain data that were not publicly available. Data on education and training in schools, institutes, and companies were collected from internal records and interviews with the respective official representatives. The text has also tapped into a wealth of data from previous studies. While the report covers a broad topic, it does not examine specific policies or programs in any great detail. Nevertheless, despite this acknowledged shortcoming, the author hopes that this work will pave the way for more research and publications that take a more in-depth look at individual efforts for learning as well as the commitment made by companies to develop highly skilled workforces. Young-Hyun Lee Senior Research Fellow Korea Research Institute for Vocational Education and Training Table of Contents I. The Economy and Labor Market .............................................................1 A. Socio-economic Contexts ...........................................................1 B. Labor Market Challenges to Workforce Development ................. 4 C. Current Skill Levels .....................................................................9 II. The Education System ........................................................................ 11 A. Education Growth and Development .......................................11 B. School Education ....................................................................14 C. Administration of Education and HRD Policy Coordination ..........................................................................20 D. Financing of Education ............................................................21 III.