# South Korean Study Finds AI Subsidies Cut Hiring

A South Korean study found that firms receiving government AI-adoption subsidies reduced total new hiring by 8% and hiring of workers aged 19–34 by 10.1% over the three years after adoption, compared with firms whose applications were rejected. The findings could shape evaluation of the Ministry of Science and ICT’s AI Voucher Support Program, which subsidizes small and midsize companies’ purchases of AI solutions and consulting. For procurement officials and participating firms, the results highlight the value of assessing workforce impacts alongside technology adoption and productivity outcomes.

- The study points to a need for evaluation measures that distinguish hiring flows and track employment effects, particularly for younger workers.
- MSIT and program stakeholders may consider stronger links between AI adoption support, AI training, and entry-level employment; the signal describes these as potential evaluation changes, not established requirements.
- Firms pursuing or delivering AI solutions and consulting through the program should be prepared to demonstrate workforce outcomes as well as adoption results if evaluation criteria change.

**Jurisdictions:** international
**Industries:** Information Technology
**Topics:** Artificial Intelligence, Grants & Funding
**Published:** November 11, 2026

### Government Entities
- Ministry of Science and ICT (MSIT)
- Ministry of Employment and Labor (MOEL)

### Key Quotes
> Given the delays workers face in finding new jobs and the burden of income gaps, the pace of automation may be excessively fast from a social standpoint. Even if we expect long-term gains in productivity and employment, we need mechanisms to cushion the shock of the transition.
> — Lee Hwan-woong, economics professor

### Sources
- [Government AI Subsidies Cut Youth Hiring 10%, Study Finds](https://en.sedaily.com/society/2026/11/11/government-ai-subsidies-cut-youth-hiring-10-percent-study) - Seoul Economic Daily