In the spring of 2020, when COVID-19 struck, campus gates were firmly shut. After postponing the start of the semester several times, universities ultimately decided not to open at all. Freshmen met their classmates for the first time through monitors in remote lectures. There were no entrance ceremonies, no orientations, no first encounters with senior students. Campus gates did not fully reopen until the second semester of 2022. A gap of nearly two and a half years emerged at the pivotal stage of life when young adults should have been taking their first steps into adulthood.
Several years later, this COVID generation stands before another "closed door." It is the door of the hiring market. According to the National Data Agency and other sources, the unemployment rate for youth aged 15 to 29 reached 7.4 percent in the first quarter of this year, the highest in five years. The number of unemployed youth stood at 272,000, accounting for 26.4 percent of total unemployment. As of March, the youth employment rate stood at just 43.6 percent, and the number of employed youth has declined for 41 consecutive months.
The slump in youth employment is the result of overlapping factors: an economic slowdown, a preference for experienced workers, the expansion of ad-hoc hiring, and disparities between industries. Recently, a new factor has been weighing heavily on the situation. It is the spread of artificial intelligence (AI). AI boosts corporate productivity. But for young people at the front line of the labor market, it works differently. As AI replaces the standardized, textbook tasks typically assigned to entry-level workers, or enables one person to do the work of two or three, companies have less need to hire and train newcomers. According to the Bank of Korea, 98.6 percent of the 211,000 youth jobs lost between July 2022 and July 2025 came from industries with high AI exposure. While AI transformation is raising corporate productivity, the shock of that change is hitting young people at the entry point of the labor market first.
The COVID generation's job-search failure is different in nature from past youth unemployment crises. As the term "COVID generation" suggests, those being pushed out of the hiring market now are the generation that passed through the critical years of academic study and relationship-building abnormally during the pandemic. School is not only a place that transmits knowledge. It is a space of socialization, where young people learn rules outside the family, negotiate conflicts, and learn how to keep appropriate distance from others. The workplace is the next stage of socialization. It is the arena of occupational socialization, where one learns to report, persuade, pay the price of mistakes, and internalize the language of responsibility. For a generation whose campus gates were closed, having the hiring market gates also shut means being pushed outside the door twice in a row during the socialization process.
This is not a call to hire the struggling COVID generation out of sympathy. The later a generation enters society, the more consumption shrinks, the weaker the domestic demand base becomes, and the shallower the labor force foundation grows. The permanent loss of lifetime income that will result from delayed youth entry into the workforce, and the acceleration of low birth rates and aging that follows, will amplify downside risks across the broader macroeconomy. For companies, hiring is a minimum form of self-defense against the devastation of the industrial ecosystem.
The efficiency created by AI also gains value only when it is consumed by people, used within organizations, and given meaning within society. A company that does not cultivate people will ultimately face a market without people. No matter how much productivity AI delivers, no matter how excellent the goods and services produced, corporate activity cannot be sustained if the people who buy, use, and evaluate them dwindle.
Moreover, it is wrong to view the COVID generation as unnecessary talent in the AI era on grounds of insufficient tacit knowledge relative to experienced workers. During the pandemic, they adapted earlier than anyone else to remote collaboration, uncertain schedules, self-directed learning, and digital tools. They possess as basic assets a sense for working alongside AI, the speed to absorb new tools without wariness, and the ability to find their own methods when structures waver. Any company that speaks of AI transformation (AX) has no reason to ignore this. The completion of AX ultimately depends on people who know how to work with AI.
The COVID generation is now knocking on the door of the hiring market. Will companies keep the door locked and move forward with only AI, or will they open the door and move to the next market together with these young people? The judgment rests with companies. Without people, neither technology nor companies have any reason to exist.
