South Korea’s baby bump extends into second year, offering hope

[SEOUL] South Korea’s fertility rate rose for a second consecutive year in 2025, a rare bright spot for a country that has long struggled with the world’s lowest birth rate.

The number of babies a woman is expected to have over her lifetime increased to 0.8 last year from 0.75 in 2024, preliminary data released on Wednesday (Feb 25) by the Ministry of Data and Statistics showed. Births in 2025 climbed 6.8 per cent from the previous year to 254,500, the highest total since 2021, when about 260,600 babies were born.

The improvement comes as marriages show signs of recovery after a prolonged slump, supported by incentives designed to ease the financial burden of raising children. Authorities have expanded cash allowances, childcare services and housing support, including preferential mortgage programmes for families with newborns.

While the increase remains modest, and too recent to declare a lasting trend, it suggests some government programmes aimed at reversing population decline may be gaining traction.

For years, South Korea’s plunging population, with a fertility rate that was among the lowest in the OECD, has loomed as a threat to the economy and society. A shrinking workforce with a rapidly ageing population adds to strains on the pension and care systems, driving the government into crisis mode. The nation faces issues ranging from labour shortages to the military’s ability to recruit enough personnel.

Successive governments have poured resources into reversing the decline, spending an estimated 380 trillion won (S$335 billion) on fertility incentives and family support programmes between 2006 and 2023.

The country allocated 28.6 trillion won in 2025 for programmes directly aimed at addressing its low birth rate, a 13 per cent increase from a year earlier, according to Presidential Committee on Ageing Society and Population Policy.

Despite these efforts, progress has been slow, and deeply entrenched social and economic factors – high housing costs, steep private education expenses and persistent gender gaps in the workplace – have dampened the impact of policy measures.

Beyond government programmes, some private companies have jumped in with their own incentives. Real estate developer Booyoung’s pledge of 100 million won cash bonuses for employees who have children, resonated with young families stressed by the high cost of living.

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Regional disparities remain stark: Seoul recorded one of the lowest fertility rates among major cities, second only to Busan, underscoring the impact of high living costs and housing pressures, while the administrative city of Sejong has historically posted comparatively higher rates.

South Korea is not alone in fretting over demographics. Birth rates are falling across much of East Asia, including in Japan and Taiwan, and in advanced economies throughout Europe and North America.

In the US, President Donald Trump has proposed a US$5,000 baby bonus as part of efforts to boost fertility.

China, confronting its own demographic slowdown after decades of restrictive population policies, announced in mid-2025 that it will begin providing an annual 3,600 yuan (S$662) allowance per child under age three. BLOOMBERG