More than seven years after relocating to Sejong, the Ministry of Science and ICT placed the office of a newly created organization in the capital region to secure top developers — a decision rooted in a talent shortage spreading across large corporations, state-run enterprises, research institutes, universities and startups alike. To align with balanced growth, the third national policy goal of the Lee Jae-myung administration, organizations should base themselves outside the Seoul metropolitan area. Yet without an office in the capital region, it is difficult to recruit the skilled workers needed to deliver immediate results.
The concentration of talent in the capital region is common across artificial intelligence and other core national technology and research and development sectors. According to the Korea Industrial Technology Association's 2025 survey on corporate research workforce supply and demand, released on the 2nd, 5,444 of 8,569 corporate research labs in national strategic technology fields, or 63.5%, are located in the capital region. That means two out of every three labs sit in the Seoul metropolitan area. The association attributed the pattern to "a combination of factors, including the ease of securing skilled researchers, proximity to large corporations, government-funded research institutes and universities, and the concentration of investment and financial infrastructure." Jun Young-hyun, vice chairman of Samsung Electronics, and Kwak Noh-jung, chief executive of SK hynix, cited improvements in housing, culture, medical care and education infrastructure for employees as key conditions for anchoring semiconductor fabs outside the capital region at a public briefing on the three mega projects in late June.
Cases of employees quitting after their workplace moved out of the capital region are not uncommon. An official at a government-funded research institute in North Chungcheong Province said the institute faces particular difficulty when hiring short-term staff for one to two years, such as replacements for employees on parental leave or contract researchers. "Some staff have quit since July this year, after the shuttle bus running to and from the capital region was suspended on government orders," the official said. An analysis by the National Assembly Budget Office of staffing and resignation figures from 2010 to 2025 at 97 institutions relocated under the government's first public institution relocation program found that the average number of resignations rose meaningfully, from 38 before the move to 60 afterward.
Kang Jong-soo, chief executive of startup accelerator Coals Dynamics, said attracting senior and leadership-level talent with experience at major information technology companies is critical for startups, but such people are reluctant to leave the capital region. "That is why an irony arises in which most companies founded outside the capital region keep their registered headquarters in the provinces while building a larger organization in the capital region or at an office there under the name of a research lab," Kang said.
Senior developers frequently bring skilled colleagues with them when they change jobs, which makes locating in the capital region, where such communities are well established, overwhelmingly advantageous for companies and research institutes, Kang said. Rebellions, an AI chip company that moved its headquarters near Jeongja Station in Seongnam, Gyeonggi Province, late last year, is said to have excluded areas south of Pangyo from its list of candidate sites while searching for new offices.
Experts warn that unless this concentration of talent in the capital region is resolved, government strategies for balanced national development — the three mega projects, the cultivation of regional growth engines under the five-hub, three-special-zone plan and the second public institution relocation program — could all produce only fleeting effects. Even if power, water, roads and other infrastructure needed to run factories are all in place outside the capital region, the concern is that a failure to draw talent could weaken corporate competitiveness.
Baek Seung-min, a research fellow at the Korea Institute for Industrial Economics and Trade, said the first round of public institution relocations increased population and employment in innovation cities, but the scale and scope of the ripple effects were limited, with innovation city populations turning to net outflows from 2023. "In particular, the fact that people continue to move out for job-related reasons even after the relocations were completed suggests a shortage of companies providing quality jobs in innovation cities," he said.
Noh Min-sun, a research fellow at the Korea Institute for Small Business and Startups, said the most realistic near-term option, amid worsening concentration of talent in the capital region, is to improve the living and working conditions of young workers at small and medium-sized companies in the provinces. "In particular, the government needs to expand support far more boldly for young people employed at companies located outside the capital region, by creating flexible working environments and broadening asset-building programs such as the Youth Tomorrow Filling Deduction into region-specific versions," Noh said.
