CRI

 [ABSTRACT]

Background and Purpose of the Study

The transition to a vulnerable population structure primarily caused by low birth rates and an aging population, particularly the decline in the working-age population, can lead to a vicious cycle on both the demand and supply sides, potentially reducing economic vitality.

For Chungbuk (Chungcheongbuk-do) to achieve sustainable growth, it is essential to enhance the efficiency of economic policies by establishing differentiated response strategies based on the regional economy's growth pattern, which reflects population structure changes.

This study was conducted to identify the regional economy's growth factors from a population-structural perspective, analyze the regional economic growth pattern based on the relationship between the working-age population and economic growth, and thereby provide basic data needed to set the direction for economic policy that can mitigate the negative impact of the working-age population decline.

Population Structure (As of 2024)

Chungbuk's resident mid-year population in 2024 is 1,587,715, an increase of 16,593 compared to 2015, with an average annual growth rate of 0.12% over the last 10 years.

The population structure consists of 10.9% juvenile population, 67.7% working-age population, and 21.4% elderly population, indicating that the province has already entered a super-aged society.

Juvenile Population: 172,678, a decrease of -49,952 since 2015, with an average annual change rate of -2.8% over the last 10 years.

Working-Age Population: 1,074,846, a decrease of -43,683 since 2015, with an average annual change rate of -0.4% over the last 10 years.

Elderly Population: 340,191, an increase of 110,228 since 2015, with an average annual change rate of 4.4% over the last 10 years.

Only Jincheon-gun (18.9%) and Cheongju-si (16.3%) are classified as an aged society, while the following are already super-aged societies: Goesan-gun (40.6%), Boeun-gun (40.2%), Yeongdong-gun (37.4%), Danyang-gun (37.4%), Okcheon-gun (34.9%), Jecheon-si (26.7%), Eumseong-gun (25.7%), Chungju-si (23.8%), and Jeungpyeong-gun (21.1%).

Economic Status (Real GRDP as of 2022)

Chungbuk's Real GRDP (2020 base year price, preliminary) in 2022 was 83.6 trillion KRW, recording an economic growth rate of 4.2% year-on-year and an average annual rate of 2.9% over the last 5 years.

The industrial structure is manufacturing-based, composed of: Agriculture, Forestry, and Fishing (2.5%), Mining (0.2%), Manufacturing (48.8%), Electricity and Gas Industry (-1.3%), Construction (6.3%), and Services (43.5%).

GRDP by City/County: Cheongju-si is the highest at 42.5 trillion KRW (50.8%), followed by Eumseong-gun (10.0 trillion KRW, 11.9%), Chungju-si (8.9 trillion KRW, 10.6%), Jincheon-gun (8.8 trillion KRW, 10.6%), Jecheon-si (3.9 trillion KRW, 4.6%), Jeungpyeong-gun (1.9 trillion KRW, 2.2%), Okcheon-gun (1.8 trillion KRW, 2.1%), Goesan-gun (1.7 trillion KRW, 2.0%), Boeun-gun (1.5 trillion KRW, 1.8%), Yeongdong-gun (1.4 trillion KRW, 1.6%), and Danyang-gun (1.3 trillion KRW, 1.6%).

GRDP Share by Region: Cheongju Area (50.8%), Central Area (26.8%), Northern Area (16.9%), and Southern Area (5.5%), indicating a severe regional imbalance within the province.

Growth Contribution Analysis (Shift-Share Analysis)

By utilizing the shift-share analysis methodology to decompose the population-structural factors of regional economic growth, the role of changes in the working-age population in the regional economy was examined.

Results from decomposing per capita GRDP into labor productivity, employment rate, and population structure according to the growth accounting equation: Between 2015 and 2022, Chungcheongbuk-do's per capita GRDP increased by 29.7%.

Labor Productivity (+21.4%p, ▲72.0%) and Employment Rate (+11.6%p, ▲39.1%) made positive contributions.

Population Structure (the share of the working-age population) (-3.3%p, ▼11.2%) had a negative impact.

Labor productivity is the core factor for regional economic growth, and the employment rate, based on the working-age population, is also a crucial factor in increasing per capita GRDP. Although the impact of basic data needed to set the direction for economic policy that can mitigate the negative impact of the working-age population decline.

Population Structure (As of 2024)

Chungbuk's resident mid-year population in 2024 is 1,587,715, an increase of 16,593 compared to 2015, with an average annual growth rate of 0.12% over the last 10 years.

The population structure consists of 10.9% juvenile population, 67.7% working-age population, and 21.4% elderly population, indicating that the province has already entered a super-aged society.

Juvenile Population: 172,678, a decrease of -49,952 since 2015, with an average annual change rate of -2.8% over the last 10 years.

Working-Age Population: 1,074,846, a decrease of -43,683 since 2015, with an average annual change rate of -0.4% over the last 10 years.

Elderly Population: 340,191, an increase of 110,228 since 2015, with an average annual change rate of 4.4% over the last 10 years.

Only Jincheon-gun (18.9%) and Cheongju-si (16.3%) are classified as an aged society, while the following are already super-aged societies: Goesan-gun (40.6%), Boeun-gun (40.2%), Yeongdong-gun (37.4%), Danyang-gun (37.4%), Okcheon-gun (34.9%), Jecheon-si (26.7%), Eumseong-gun (25.7%), Chungju-si (23.8%), and Jeungpyeong-gun (21.1%).

Economic Status (Real GRDP as of 2022)

Chungbuk's Real GRDP (2020 base year price, preliminary) in 2022 was 83.6 trillion KRW, recording an economic growth rate of 4.2% year-on-year and an average annual rate of 2.9% over the last 5 years.

The industrial structure is manufacturing-based, composed of: Agriculture, Forestry, and Fishing (2.5%), Mining (0.2%), Manufacturing (48.8%), Electricity and Gas Industry (-1.3%), Construction (6.3%), and Services (43.5%).

GRDP by City/County: Cheongju-si is the highest at 42.5 trillion KRW (50.8%), followed by Eumseong-gun (10.0 trillion KRW, 11.9%), Chungju-si (8.9 trillion KRW, 10.6%), Jincheon-gun (8.8 trillion KRW, 10.6%), Jecheon-si (3.9 trillion KRW, 4.6%), Jeungpyeong-gun (1.9 trillion KRW, 2.2%), Okcheon-gun (1.8 trillion KRW, 2.1%), Goesan-gun (1.7 trillion KRW, 2.0%), Boeun-gun (1.5 trillion KRW, 1.8%), Yeongdong-gun (1.4 trillion KRW, 1.6%), and Danyang-gun (1.3 trillion KRW, 1.6%).

GRDP Share by Region: Cheongju Area (50.8%), Central Area (26.8%), Northern Area (16.9%), and Southern Area (5.5%), indicating a severe regional imbalance within the province.

Growth Contribution Analysis (Shift-Share Analysis)

By utilizing the shift-share analysis methodology to decompose the population-structural factors of regional economic growth, the role of changes in the working-age population in the regional economy was examined.

Results from decomposing per capita GRDP into labor productivity, employment rate, and population structure according to the growth accounting equation: Between 2015 and 2022, Chungcheongbuk-do's per capita GRDP increased by 29.7%.

Labor Productivity (+21.4%p, ▲72.0%) and Employment Rate (+11.6%p, ▲39.1%) made positive contributions.

Population Structure (the share of the working-age population) (-3.3%p, ▼11.2%) had a negative impact.

Labor productivity is the core factor for regional economic growth, and the employment rate, based on the working-age population, is also a crucial factor in increasing per capita GRDP. Although the impact of the population structure is underestimated due to multicollinearity with labor productivity, it is considered a factor that positively affects regional economic growth.

Regional Growth Pattern Analysis

Based on Klaassen's regional cycle hypothesis and applying a study by Heo Moon-gu (2014) that used the relative ratio of the growth rate of the regional Gross Regional Domestic Product (Income Concept) and the working-age population (Population Concept) against the national average, an analysis was conducted to determine the regional growth patterns experienced by each city/county and their current growth level.

Results of Regional Economic Growth Stage Analysis:

Growth A Region (grdp(+) > working-age population(+)): Cheongju, Jeungpyeong

Growth B Region (grdp(+) < working-age population(+)): Jincheon

Decline D Region (grdp(-) < working-age population(-)): Chungju, Danyang

Decline E Region (grdp(-) > working-age population(-)): Jecheon, Okcheon, Yeongdong, Goesan, Eumseong

Potential Growth Region (grdp(+), working-age population(-)): Boeun

No regions were found to be in a Stagnation C Region (grdp(-), working-age population(+)) state.

The growth patterns differ clearly by city/county. In particular, regions in the Southern Area show minimal fluctuation in the working-age population and income, indicating low dynamism in the regional economy.

 Policy Directions

Based on the analysis results, for Chungbuk to pursue sustainable growth, the following are required:

Utilizing the Elderly Population and promoting them as a new growth engine in response to accelerating aging.

Inducing the influx and settlement of the working-age population.

Seeking ways to expand the labor market participation of substitute labor forces in response to the decline in the working-age population.

Improving labor productivity.

Seeking differentiated growth strategies that consider the industrial-structural characteristics based on differences in natural resources, innovation capabilities, and infrastructure.

Promoting balanced development through the expansion of new growth engines.

Establishing customized strategies for each growth stage.

In short, it is necessary to establish a "Data-driven Policy" system that comprehensively collects and analyzes various public and private data and utilizes it throughout the policy formulation, implementation, and evaluation process. This will maximize the objectivity, efficiency, and performance of policies and, through this, strengthen the monitoring and feedback system for changes in population and economic conditions.