Claim: Thanks to its simplicity, Hangul has virtually eliminated illiteracy in Korea. Today, according to the CIA Factbook, South Korea has a literacy rate of 97.9%. (North Korea, like its election results, reports a 99% literacy rate).

Rebuttal: First, there is little correlation between Hangul itself and literacy rates. Second, South Korea has high rates of functional illiteracy compared to other developed countries.

There is little correlation between the simplicity of Hangul and high literacy rates. The primary correlation with literacy rates is the availability of education. As seen in the map above, it is developing countries that have lower literacy rates. This is further supported by the fact that in the first 500 years of Hangul’s existence Korea’s literacy rate was not significantly higher than other pre-industrialized states and even its neighbors.
Countries with writing systems with similar complexity as Hangul have similar or higher literacy rates than Korea. Hangul only has 24 letters. The English alphabet has at least 52 letters (upper case and lower case); Russian Cyrillic alphabet has 66 letters (again, upper case and lower case). Even though these writing systems are slightly more complex, many of the countries that use them have similar or higher literacy rates as Korea.
How about Korea’s immediate neighbors, who use a writing system often detested as overly cumbersome by Hangul supremacists and exclusivists? Japan uses at least 2,228 symbols (2,136 common use Kanji, plus 96 syllabic letters from Hiragana and Katakana); Taiwan and China both use Mandarin and use a lot more Chinese characters than Japan. Surprisingly, even with writing systems with two orders of magnitude higher complexity than Hangul, Japan and Taiwan both have literacy rates slightly higher than Korea. According to the CIA World Factbook, Japan has a rate of 99% and Taiwan has a rate of 98%. Also, China is not that much far behind; it has a literacy rate of 95%, an impressive rate considering how large China is and that at least 10% of the population is not Han Chinese.

With most developed countries’ literacy rates approaching 99%, a more interesting measure of literacy is functional illiteracy. Functional illiteracy concerns with reading skills above the basic level necessary to manage daily life and employment. It is different from pure illiteracy, the measure discussed above, which is the inability to read at all. The two are not unrelated: if one is purely illiterate, then he is also functionally illiterate. It should be noted that one criticism of functional illiteracy is that the measure is not uniform.
The Organisation for Economic Co-operation and Development (OECD) has been measuring functional illiteracy among member states, which comprises of most developed countries including South Korea. In a 2005 study, South Korean adults had //the highest// rate of functional illiteracy out of 22 OECD member states surveyed with a rate of 38%, much higher than the average of 22%. Almost three in four Korean adults had difficulty reading information necessary for their occupation or skill.
Some Korean education experts, including those in favor of Hangul-Hanja mixed script, have attributed the high rate of functional illiteracy to the lack of Hanja education in Korean public education system. This is not a far-fetched claim, as 60-70% of the Korean vocabulary is derived from Hanja, many of which appear more often in technical fields. Another Korean poll reports that 58% of college-aged Koreans, most of whom have never been taught Hanja, have felt inconvenienced by their lack of knowledge of Hanja at some point in their lives.