South Korea Has Spent $200 Billion Trying to Raise Its Birth Rate. It Is Now the Lowest Ever Recorded.

A government audit has confirmed that South Korea's total fertility rate fell to 0.68 in 2024 — the lowest figure ever recorded by any country in peacetime — despite twenty years of pro-natalist policy spending that has totalled an estimated $200 billion in cash transfers, childcare subsidies, and parental leave incentives. The audit asks, with unusual candour, whether the money was wasted.

The audit's most uncomfortable finding is not the failure of the spending but the absence of any evaluation framework that might have identified the failure earlier. Of the 286 distinct pro-natalist policy programmes implemented by central and local governments since 2006, only 31 had defined outcome metrics at inception. Of those 31, only 9 had been formally evaluated against their metrics at any point. The remaining 255 programmes were designed, funded, and renewed without any evidence base for their effectiveness.

Demographers have argued for years that South Korea's birth rate decline is driven by factors that cash transfers cannot address: the extreme cost of housing in cities where young people must live to access employment, an education system that imposes enormous financial and time costs on parents, a corporate culture that structurally penalises women who take career breaks, and a social expectation of parenting intensity that makes the decision to have children feel incompatible with any form of individual life.

The audit recommends redirecting spending from birth incentives to what it calls "life condition improvements" — housing, working hours, and care infrastructure — while acknowledging that the political constituency for writing cheques to parents is easier to mobilise than the constituency for structural reform.

"We paid people to have children," said demographer Cho Young-tae. "They looked at their lives and decided no amount of money was worth it. That is not a policy failure. That is information."