Korea’s parental leave benefits lag behind OECD average

Korea's parental leave benefits average at 44.6 percent of actual wages, placing it near the bottom of the list among the Organization for Economic Cooperation and Development member nations, data revealed Sunday.

Although the country offers an extended parental leave period, the actual utilization rate remains low, with especially adverse impacts on low-income workers, the data showed.

In Korea, workers insured for more than 180 days can take up to a year of parental leave to care for children under the age of 8. The benefits include 80 percent of the individual's wage, capped between 700,000 won ($524) and 1.5 million won monthly.

According to the OECD Family Database, Korea's average parental leave benefits stand at 44.6 percent of individual's actual income, seeing the country rank 17th out of 27 OECD member countries with comparable systems.

The duration of parental leave in Korea currently ranks 7th, trailing Finland, Hungary, Slovakia, Latvia, Norway and Estonia. Beginning in 2024, this period will be extended to one and a half years. However, despite the extended leave period, the actual utilization rate remains the lowest among OECD countries.

According to a report by the National Assembly Research Service, Korea averages 21.4 female and 1.3 male parental leave users per 100 births, the lowest number of users among the 19 OECD countries that have released related information.

Moreover, as comparatively low financial benefits of parental leave affect low-income workers more, the number of parental leave users among low-income workers has decreased over the years.

A NARS report showed that the number of parental leave users with monthly salaries over 3 million won increased 2.55 times from 24,832 in 2015 to 63,332 in 2020, but among those who earned less than 2.1 million won per month, the number of parental leave users fell by 19.2 percent from 95,160 to 70,904 during the same period.

The report suggested that the government should consider raising the lower limit of parental leave benefits as the impact of income loss caused by the use of parental leave is greater for low-income workers.

Meanwhile, the government is currently considering raising the cap on parental leave benefits to the minimum wage level. The monthly minimum wage is 2,015,580 won this year and will be raised to 2,060,740 won next year. If the maximum parental leave benefit rises to the minimum wage level, the monthly benefit of parental leave will increase by more than 500,000 won from the current 1.5 million won a month.

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