The World's Lowest Birth Rate

Why South Korea's fertility rate fell to around 0.7, the economic consequences of a shrinking population, and why spending on incentives has had limited effect.

South Korea has the lowest fertility rate in the world.

The numbers

The total fertility rate fell to around 0.72 in 2023, far below the 2.1 needed to keep a population stable.
It rose slightly in 2024, to around 0.75, the first increase in years.

Causes

High costs of housing and education.
Long working hours.
Career penalties for women who have children.
Competitive society and job insecurity.
Delayed or fewer marriages.

Economic consequences

Shrinking workforce.
Rapid ageing and rising pension costs.
Lower growth potential.
Military recruitment challenges.

Policy efforts

Korea has spent large sums on incentives: cash for births, childcare, parental leave and housing support. Results have been limited, suggesting deeper social and economic changes are needed.

Elderly poverty

Korea also has one of the highest elderly poverty rates in the OECD, as pensions were introduced late.

The empty school

In rural Korea, some schools have closed because there are too few children, while nursing homes fill up.

Thinking cash incentives alone can raise birth rates

Housing, work culture and costs matter more.

Key takeaways

Korea's fertility rate fell to around 0.72 in 2023.
High costs, long hours and career penalties are causes.
A shrinking workforce and ageing threaten growth.
Incentives have had limited effects so far.