The number of unemployed young adults in South Korea has been increasing. Some 20–30 per cent of the youth population are having difficulty finding jobs. According to government figures, the youth unemployment crisis is caused by a loss of desired jobs, a decline of recruitment in the private sector, and a strong inclination to find jobs in large companies or the public sector, among others.

Following on from the success of a social impact bond passed to help children several years ago, the Seoul Metropolitan Government, together with Pan-Impact Korea, recently launched a second social impact bond project to address youth unemployment.

Pan-Impact Korean is a social impact bond intermediary. For the youth unemployment initiative, it manages the project by taking charge of raising capital, choosing a service provider, etc.

The project targets more than 500 unemployed young people who are members of the ‘hard-to-employ population’ as defined by the Seoul Metropolitan Government. The budget for the project is 3 billion won (US$2.34 million). About 0.1 billion of this budget was provided by the Seoul Metropolitan Government. The rest of the budget was raised by private investors.