Basic Report

Reduction in the fraction of the working-age population, from age 20 to 64, by fallingrate of labor force in the manufacturing industry may become one of reasons to makeeconomy grow more slowly. The decline of employment rate, the increase of life expectancy,and mobility toward larger regions are emerged as a social problem in global age structure,and Korea is not free to be exception. This does not merely mean to population transition,but will cause the shortage of working force and drives macroeconomic changes in economyand fashion to live. There happen to be too few people to produce the goods and servicesthat people want to consume. Therefore, low employment rate, high rate of the old, andmigration toward bigger region play a role to cease to grow in regional and macro economy.However, macroeconomic policy, high saving rates, human capital accumulation, R&D,and trade openness explained only part of growth in Korea, and remainder left unexplained.But a large part of the remained growth could be explained when demographic change orfactors were considered (Bloom and Finlay, 2008). Also, regional economic characteristicsmay be expected to be changed as population structure changed (Bloom et al. 2008).Generally, increasing longevity caused change in population age distribution (Lee, 2003).And, change of labor force which is caused by population change affects to the economicgrowth. Therefore, just defining change of labor force as the change in whole labor forceis not proper to explain how much change of labor force affects to the economic growth,since the changes in labor force are brought from different sources. Heijdra and Romp (2006)also supported this with suggesting that there were many sources to determine a uniquepath as considering the population changes.Regarding aging, life expectation is growing compare to the before. Aging is notindependent with fertility and mortality, because population growth of aging is affected bylow fertility and mortality. Therefore, the increase of aging population is considered as aresult of low fertility because individuals live longer tend to have fewer children. The declineof labor force will increase the working age share because the number of youth dependentsfalls with the number of working age individual increases. While increase of aging, it willaffect to the decline of working age, because old age will act as dependent to the workingratio. This growing aging is typical fashion of region and nation. But, other factor, suchas the development of certain industry, for example development of medical industry, shouldhave to be considered. Because the impact of aging to the economy is not solely dependon the change of the number of aging. Therefore, transitory changes due to populationvariation lead to saving behavior and labor supply decision along with government policy.According to Ludwig (2005), magnitude of demographic changes will affect future labor,capital and consumption goods markets.In case of migration, the change of migration affects to the society, economically andsocially. Generally, the impact of migration was dealt in the case of how migration affectedto the change of economy. But it was restricted to show what happened to the economywhen the changes of wage and total factor productivity were considered. As Bloom andCanning (2004) suggested, the world population have been distributed unevenly across theworld. The disparities reflected the existence of considerable heterogeneity in migrationprocesses. However, the effects of migration on the transition of population have strongrelationship with the macroeconomic changes in regional level.Therefore, finding the effects by increase of number of student in the special educationprogram for suiting them into the industry such as technical and vocational education, theimpact of the development of certain industry such as medical industry to aging, and theimpact of migration of labor force in the manufacturing industry toward metropolitan areaon the macro economy are worthy to receive much attention.