KUALA LUMPUR - South Korea’s Ministry of Justice has found that the inflow of foreign workers holding skilled worker visas has contributed to higher employment among Korean nationals and supported regional economic growth.

In a statement issued on Monday, the ministry said it had conducted a comprehensive analysis of the impact of foreign labour on local economies and domestic employment, in consultation with relevant government agencies, before setting this year’s annual visa quota.

The study showed that the skilled worker visa (E-7-4) had a positive effect on regional development and population movement among Koreans, as reported by ChosunBiz.

Under the system, foreign nationals who have worked for at least four years on a non-professional employment (E-9) visa under the Employment Permit System, or on a visit and employment (H-2) visa for ethnic Koreans from China and former Soviet regions, may apply to switch to an E-7-4 visa if they meet required standards for skills, income and Korean-language proficiency.

Successful applicants are eligible for long-term residence and family reunification.

According to the analysis, regions that made greater use of skilled foreign workers experienced some easing of labour shortages, alongside higher productivity among core manufacturing and industrial companies.

Between 2018 and 2023, every additional foreign worker in a region was associated with an increase of about one Korean national relocating to the same area for employment reasons.

In sectors such as fabricated metal products manufacturing and professional trade contracting, foreign worker inflows were also linked to higher employment among local workers.

The ministry said no statistically significant negative impact was found in most industries and occupations.

Based on these findings, the Ministry of Justice has set this year’s annual quota for skilled worker visas at 33,000, slightly lower than last year’s 35,000, taking into account recent conversion trends, industry demand and feedback from related ministries.

To support the mould-making industry, which is facing an ageing workforce and labour shortages, the ministry plans to pilot the general skilled worker visa (E-7-3) for foreign mould technicians. Details will be finalised by the ministry’s Visa and Stay Policy Council.

The ministry added that pilot schemes for occupations such as care workers and power transmission electricians, as well as seasonal worker and non-professional employment visas, would continue to be managed within necessary limits.

It also said future assessments would expand beyond employment-related visas to include other categories that affect regional economies, with the aim of managing foreign labour inflows in a more rational and systematic manner.