Korea’s work-hour cuts hinge on labor reform: study

Amid South Korea’s push to reduce working hours, a state-commissioned study suggests the country is on track to bring annual working hours down to the OECD average by 2030, but warns progress will require broader changes to the country’s rigid labor structure.

The report projects that Korea’s average annual working hours will fall to 1,739 by 2030, down from 1,859 in 2024, if the current pace of decline continues.

The estimate was included in research commissioned by the Ministry of Employment and Labor to develop a roadmap for reducing actual working hours.

Reducing annual working hours to around 1,700, roughly the average for the Organization for Economic Cooperation and Development, has been a key labor policy goal of President Lee Jae Myung's administration.

The initiative is tied to broader social challenges, including improving quality of life, addressing low productivity per hour worked and tackling the country’s low fertility rate, which has partly been linked to insufficient time for child care.

Korea has already made progress. With the adoption of the five-day workweek and revisions to the Labor Standards Act limiting work beyond 40 hours per week, average annual working hours have fallen by 137 hours from 1,996 in 2017.

Still, the country ranks sixth-highest among OECD members, with working hours exceeding levels seen in Western Europe, Japan and the US.

Following President Lee’s pledge to introduce a 4.5-day workweek, the Ministry of Employment and Labor is offering incentives to small and medium-sized businesses to reduce the number of working days, while also seeking to curb unpaid overtime.

The report notes, however, that such measures alone may not be enough. Much of Korea’s earlier progress came from reducing overtime beyond the standard 40-hour workweek, leaving less room for further cuts unless the country expands shorter-hour arrangements and improves the use of paid leave.

“Compared to the past, working hours have already decreased significantly, making it difficult to sustain the trend without additional efforts,” the report said. “The range of choices in working-hour arrangements should be broadened, and expanding the unit period for calculating working hours should also be considered.”

The study also highlighted the concentration of workers under standard contracts. Some 53.1 percent of employees in South Korea work under 40-hour contracts, significantly higher than 30.9 percent in Germany, 15.9 percent in the United Kingdom and 12.5 percent in France.

It also cited the need to improve the use of paid leave. Despite legal guarantees, workers in Korea remain reluctant to take extended vacations.

Only around 3 percent of workers in Korea took a full week off during the summer holiday season, according to the Korea Labor Institute. In contrast, about half of workers in France, Denmark and Italy take extended summer leave, while the figure stands at around 20 percent in Germany.

“Institutional changes are needed to encourage workers to fully use their annual leave and to make it easier to take time away from work for family and other personal needs,” the report added.