Consumer-Directed Care Policy in Korea: No Recognition, No Rewards for Carers’ Task Difficulties and Work Experience

A consumer-directed care program is one type of privatization strategy that has been widely adopted by western welfare states. However, little is known about the East Asian consumer-directed programs and their consequences since these countries are relative newcomers in the social services field. This study aims to figure out how consumer-directed program affect the working conditions of care workers, and how it conceptualizes care labor in the Republic of Korea. To achieve this, the study reviewed care policy in Korea, and it then analyzed care workers’ working condition and pay using 2007-2016 survey data from “the Occupation Labor Force Survey at Establishments” (a nationally representative sample).

In Korea, social services, such as long-term care and personal care for disabled people, were introduced in 2007 and has since expanded. Accordingly, the number of related workers has sharply increased over the last 10 years, and this sector accounts for 15% of all newly created jobs in the labor market. Most of these social services were originally adopted as consumer-directed program. In order to make this a competitive market from a zero-base, the government established regulations that made it easy to enter the care market; however, this led to a disordered market filled with small private institutions. In addition to this, the payment system for workers is designed as a single fixed price per service hour, which ignores differential work efforts such as the level of care difficulty, and workers’ experience. The data analysis showed that care workers experience short and unstable working hours, and underpaid in comparison to other service workers. This implies that Korean public policy led to the devaluation of care labor in order to contain cost: it is in line with the feature of Developmental Welfare States that use welfare policy only as an instrument of economic development.