A growing number of South Koreans in their 30s are deferring repayment of their student loans after losing or leaving jobs they took following graduation. A narrowing job market has delayed entry into the labor force, and more borrowers are seeing gaps in income even after finding work, extending the burden of student debt into their 30s.
A total of 8,475 people in their 30s were approved for deferred repayment of income-contingent student loans last year, according to National Tax Service data obtained by Rep. Park Soo-young of the People Power Party on the 23rd. That was up 15.4% from 7,346 in 2024 and the highest figure on record.
Borrowers in their 30s first outnumbered those in their 20s in 2024, when the younger group recorded 6,587 deferrals, and the gap widened further last year. Deferrals among people in their 20s fell to 6,190, leaving a gap of 2,285. It is the first time the age breakdown of deferred borrowers has been disclosed.
Borrowers in their 30s also accounted for a disproportionate share of the amounts involved. Of the 24.33 billion won in total deferred repayments last year, 15.019 billion won, or 61.7%, came from borrowers in their 30s. The figure for those in their 20s was 8.926 billion won.
Under the income-contingent loan program, borrowers begin repaying once their annual income passes a set threshold, with the amount owed determined by income. Because payments are assessed based on past income, borrowers can postpone repayment if their current income is cut off by job loss, business closure, resignation or parental leave.
Repeat deferrals and arrears after deferral periods end are also rising. The number of people approved for deferral twice or more in a single year climbed 2.7-fold, from 488 in 2021 to 1,320 last year. The amount they deferred grew 3.2-fold over the same period, from 1.216 billion won to 3.861 billion won.
Many borrowers did not escape their debt even after postponing payments. Of the 7,892 people granted two-year deferrals in 2022 on grounds of financial hardship, 1,263 were in arrears as of the end of 2025 — roughly one in six.
Analysts point to a deteriorating job market for young people as the backdrop. The average number of employed people in their 20s was 3.279 million a month from January through August this year, down 193,000 from 3.472 million in the same period last year, according to the Korean Statistical Information Service. It was the steepest decline since 1998, the year of the International Monetary Fund bailout during the Asian financial crisis. Jobs disappeared faster than the population shrank.
The point at which young people land their first job is also being pushed back. The share of people aged 20 to 34 who took a year or more to find their first job rose to 33% in 2025 from 29% in 2020, according to the Ministry of Data and Statistics. As of May this year, university graduates took an average of four years and 5.7 months to complete their degrees, 1.3 months longer than a year earlier and the longest since the data series began in 2007.
Kim Ji-woon, a professor of economics at Hongik University, said the pool of entry-level positions is shrinking as companies scale back mass hiring of new graduates in favor of experienced workers. "The decline in new hiring of young people at home and abroad since the spread of AI also appears to be a compounding factor," the professor said.
More young people are also leaving the labor market after finally securing jobs. The number of people aged 20 to 34 with work experience who described themselves as "resting" rose to 477,000 in 2025 from 360,000 in 2019, according to the Bank of Korea. Over the same period, the share of "resting" among the economically inactive population aged 30 to 34 rose to 30.7% from 15.8%.
The central bank found that among those who had left jobs within the past year, most quit voluntarily, citing personal or family matters or dissatisfaction with working conditions. Involuntary departures have been rising again since 2024 amid the economic slowdown, the bank said.
"The fact that there are now more deferred student loan borrowers in their 30s than in their 20s means a growing number of young people cannot repay their debt even at an age when employment and income should be stable," Park said. "We need to take a hard look at the employment and livelihood conditions young people are actually experiencing."
