South Korea slides to 17th in global economic freedom. Labor market woes highlight need for reforms.
Henry Russell
economic freedom rankings, lagging behind its Asian peers.
dismal 100th place, calling for urgent reforms.
political uncertainty threatens economic stability.
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Oh, South Korea. Your vibrant cities, cutting-edge tech, spicy kimchi—and now, a slipping economic freedom ranking. According to the 2025 Heritage Foundation Index of Economic Freedom, the nation has slipped from its previous rank of 14th to 17th. While a 74 out of 100 is nothing to sniff at, when you're used to performing at WSJ-levels of intensity, dropping like a needle in a second-hand '90s CD collection is less than ideal.
It's not all sunshine and K-Pop. The glaring red light? South Korea's labor market score, which has seen a dramatic dip, landing it at 100th place. That's lower than BTS on a mellow Wednesday. This score, which plummeted from last year’s still-not-stellar 87th place, is causing quite the stir in policy discussions. Taxes aren't faring much better either, with a score of 59.6, sticking both categories in the "mostly unfree" zone. Economists over at the Korea Enterprises Federation (KEF) argue that the labor market rigidity and chilly labor-management relations are the culprits, calling for a thawing—or rather, an overhaul.
In the geopolitical Scheherazade of economic freedom, South Korea still outpaces Germany, which surprises with a 53.3 score—might be those late Oktoberfest tax write-offs at play. But it remains adrift behind the U.S., sitting pretty with a 77.0, and others like Italy with a solid 70.7. Unlike short-lived tech trends, these numbers matter—impacting everything from job creation to investor confidence. A resilient economy driven by an innovative private sector provides some cushion, but as The Heritage Foundation highlights, the ongoing political soap opera could shake that sound footing.
The call for labor reform isn't just industry insiders geeking out over policy changes—it's a necessity to tackle these rankings and remake the labor landscape in the Land of the Morning Calm. So, policymakers, it's time to dust off those conference tables and get to work—a new narrative awaits.
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