What the study found
The study found that in South Korea, 10 years of tenure has no significant effect on log wages, but 20 years of tenure is associated with wage increases of 11% to 30%. It also found that sector-specific skills matter more for wage growth than occupation-specific skills.
Why the authors say this matters
The findings indicate that seniority and experience do not affect wages in the same way, and the authors suggest that sector-specific skills are an important part of wage growth in South Korea. The study suggests this is relevant for understanding how wages change over time in the labor market.
What the researchers tested
The researcher used 20 years of data from the Korean Labor and Income Panel Study (KLIPS), a long-running survey of workers' earnings and jobs. The study examined wage returns to general experience, firm tenure, and industry- and occupation-specific tenure using the Altonji and Shakotko instrumental variable approach and the Topel two-step estimation method to address bias from unobserved heterogeneity.
What worked and what didn't
Longer tenure showed a positive association with wages only at the 20-year level, where wages rose by 11%–30%. By contrast, 10 years of tenure was not significantly related to log wages, and occupation-specific returns were minimal. Sector-specific skills showed a critical role in wage growth.
What to keep in mind
The abstract does not describe detailed limitations beyond the use of the available data and methods. The findings are based on South Korea and on the measures used for experience and tenure in this study.
Key points
- Using 20 years of KLIPS data, the study examined wage returns to experience and different kinds of tenure in South Korea.
- Ten years of tenure had no significant effect on log wages.
- Twenty years of tenure was associated with wage increases of 11% to 30%.
- Sector-specific skills played a critical role in wage growth.
- Occupation-specific wage returns were minimal.
Disclosure
- Research title:
- Tenure raises wages mainly after long employment in South Korea
- Authors:
- Pyoungsik Kim
- Institutions:
- Korea Institute of Public Finance
- Publication date:
- 2026-03-06
- OpenAlex record:
- View
Get the weekly research newsletter
Stay current with scholarly research without reading academic papers — one filtered digest, every Friday.