Korean Gov’t to Let More Skilled Foreign Laborers Work Longer in Korea

The Korean government has begun to improve its system to allow more skilled foreign workers to work longer at workplaces in Korea.

On Aug. 24, the Ministry of Justice announced a plan to revolutionize work visa regulations in order to drive Korea’s economic growth at the 4th Regulation Innovation Strategy Meeting. It explained that it mapped out the plan in cooperation with the Regulation Innovation Task Force under the Office for Government Policy Coordination.

First of all, the ministry has decided to expand the quota for skilled foreign workers (E-7-4) to 35,000. The idea is to help companies continue to hire skilled foreign workers. This is 17.5 times the annual quota of 2,000 in 2022.

The Ministry of Justice plans to select the best among existing foreign workers in Korea, rather than bring in new ones. To qualify, an applicant must be a registered alien who has been in Korea with appropriate qualifications (E-9, E-10 and H-2) for a total of four years or more in the last 10 years. The applicant also has to be working normally at his or her current workplace, and have an E-7-4 employment contract for at least the next two years with an annual salary of 26 million won or more. They must also have an average annual income of at least 25 million won for the last two years and have  at least the beginner level of Korean language proficiency, scoring at least 200 points out of 300 points in a scoring system.

However, the plan excludes those who have been sentenced to a fine of more than 500,000 won, tax delinquents, those who have violated the Immigration Control Act more than four times, and those who have been in Korea illegally for more than three months.

The expansion of skilled foreign workers will come into effect beginning on May 28.

The Ministry of Justice has also decided to strengthen job placement for international students in Korea after their graduation in Korea. The ministry said it will allow international students to work for three years after graduation, and allow them to change to a specialized laborer (E-7 visa) status if they receive on-the-job training for a certain period of time as a condition of employment at a shipbuilder after graduation.

The ministry explained that the number of international students in degree programs in Korea has doubled in 12 years, from 70,000 in 2010 to 140,000 in 2022, but their employment rate in Korea was only 16 percent in 2022. Until now, international students have only been allowed to work in white-collar and professional jobs after graduation, forcing many of them to leave to third countries or return to their home countries unless they can find jobs in Korea. The plan is to allow international students to work in fields where foreigners can be employed for three years after graduation, and to expand employment opportunities such as becoming skilled foreign workers, thereby contributing to addressing labor shortage issues facing Korean companies.

Moreover, the Korean government plans to expand the regional specialty visa program for international students and systematize supports for local governments. The specialty visa allows international students to work freely after being recommended by local governments if they decide to live in a depopulated area in Korea for a certain period of time after graduation. The program is being tested.

The Korean government will also support the stable settlement of talented foreigners in high-tech fields in Korea. In the past, spouses of outstanding foreign workers were restricted from having jobs in Korea because they were granted companion visas rather than work visas. But in order to secure and expand Korea’s R&D workforce, the Korean government has decided to grant work visas to companions of outstanding foreign workers in high-tech fields, including international students. The plan is to support the stable settlement of international students in high-tech fields in Korea by improving their settlement conditions.

“We will greatly expand employment opportunities for foreign workers so that Korean companies will be able to hire legal foreign workers to their satisfaction while taking strict action against illegal immigrants to dispel public concerns,” said Justice Minister Han Dong-hoon.

The government’s plan was positively received by small and medium-sized enterprise (SME) communities in Korea in general. However, there is a general consensus among SMEs that the existing employment permit system (E-9 visa) needs to be overhauled.

Foreign workers become eligible for E-9 status when their Korean employers decide to hire them through the Employment Permit System. Foreign workers with E-9 visas have been required to leave Korea after working for four years and 10 months, but now they will be able to work for 10 years without leaving the country. While Korean small business communities are excited about the new law, they say more detailed deregulation needs to be implemented. In particular, Korean SMEs’ main complaint is that it is too difficult to manage foreign workers with E-9 visas.

In particular, there have been too many cases where foreign workers abused a rule that allows them to change jobs up to five times in a four-year, 10-month stay, they say. They point out that it is more necessary to strengthen the details of the rule and fix the problems of the rule.

In fact, according to a survey released in June by the Korea Federation of SMEs (KBIZ), 68 percent of the 500 companies surveyed said that foreign workers they employed had requested to terminate their contracts to change their workplaces with 25.9 percent doing so within one to three months. In effect, the rule has been misused for foreign workers’ fake employment before leaving for other workplaces.

“Korean employers did not forcefully bring them into workplaces in Korea against their will. Korean companies have to spend much time and money in preparing a lot of documents in order to hire foreign workers,” said Lee Ki-jung, head of the Foreign Workforce Support Center at the KBIZ. “The rule is just being used as a way to enter Korea. The rule should be changed to make it compulsory for a foreign worker to work for his or her Korean employer for at least one year and six months after signing a three-year contract with the Korean employer. This way can increase the stability of Korean companies’ employment of foreign workers.”

On the same day, the Ministry of Employment and Labor also announced a plan to eliminate killer regulations to improve labor market vitality, which includes expanding the supply of foreign workers, expanding industries for foreign workers, and removing regulations on the length of their stays. It is virtually a measure to fill urgent vacancies in industrial sites in Korea, allowing foreign workers to work in more industrial sectors and for longer periods of time.

The number of vacant jobs, which refer to those that cannot be filled despite active recruitment by Korean companies, exceeded 210,000 in the first half of this year. According to the Ministry of Employment, the number of vacant jobs in the manufacturing sector has been on the uptick -- 31,000 in 2020, 50,000 in 2021, 66,000 in 2022, and 57,000 in the first half of 2023. Non-manufacturing industries are also facing a severe labor shortage, with the number of vacancies rising from 95,000 in 2020 to 156,000 in the first half of this year.

The government has made plans to expand domestic jobs and taken measures to support them, mainly in manufacturing, logistics and transportation, health and welfare, accommodation and restaurants, and agriculture, but vacant jobs are not being filled.

For this reason, the Ministry of Employment has been increasing the number of foreign non-professional workers with E-9 visas since 2020 from 56,000 in 2020 to 110,000 this year. The plan is to add 10,000 more in the second half of this year, bringing the total number of foreign laborers to 120,000 in the Korean job market.

Jobs at medium-sized enterprises, which have been restricted so as not to let foreign workers take decent jobs away from Koreans in Korea, will also be opened to foreign labor. The immediate need for labor is no different for small and mid-sized companies. Moreover, the decision was made based on the Korean government’s realistic judgment that the nation’s root industries that form the backbone of the manufacturing industry are losing competitiveness due to vacancies. In addition, the government examined the plan’s impact on the labor market in various ways, including allowing foreign workers to be hired for manual jobs in the courier industry and in airports as well as discussing whether to include the hotel, condominium, and restaurant industries.

The Korean government has decided to take this opportunity to expand Korean employers’ options in hiring foreign laborers. Currently, industries except for the manufacturing industry can only hire foreign workers from a few designated countries. The Korean construction industry is allowed to hire workers from only six countries, including Thailand and Myanmar. The Korean fishing industry can only hire workers from five countries, including Indonesia and Vietnam. If the government designates additional countries by industry, it is expected to result in better foreign workers being hired by creating competition among foreign workers and overseas countries.

“There are some countries that are not included in 16 countries sending non-professional workers (E-9) to Korea, and there are some countries that want to send their workers to Korea,” said Choi Hyun-seok, head of the Planning and Coordination Office at the Ministry of Employment and Labor. “For example, India, which held the G20 labor ministers’ meeting last time, has also expressed its desire to send Indian laborers to Korea, so we will review such countries ahead of others, and even countries that have not done so will be considered if we deem it necessary.”