Forecasting industry-specific employment under demographic change: A demographic approach to future industrial sustainability
South Korea’s rapid population aging and persistent ultra-low fertility raise fundamental questions about the demographic sustainability of industrial labor systems. This study develops a demographic feasibility framework that assesses whether existing industry-specific employment structures can be maintained as birth cohorts contract. Using microdata from the Korean Regional Employment Survey (2008–2023) and national population projections to 2040, we estimate required labor volumes and required employment shares through a LASSO-assisted log-linear model and assess whether future labor requirements remain demographically compatible with the maximum feasible supply, rather than forecasting realized employment paths. The analysis reveals widening gaps between the labor that industries require and the maximum feasible supply that future populations can provide. Scientific and technical services show the steepest increases in required employment shares, driven by their reliance on shrinking high-skill cohorts. Manufacturing, while facing more stable overall demand, displays rising dependence on older workers and intensifying replacement pressures as these cohorts diminish. These patterns demonstrate that emerging labor shortages reflect structural demographic ceilings rather than cyclical or market-correctable imbalances. The findings situate demographic feasibility as a generalizable framework for evaluating industrial sustainability in aging societies and underscore the need for long-term workforce strategies that account for cohort dynamics rather than short-term economic conditions.
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