Only 32 pct of Employees Work Until Retirement Age

Senior job seekers looking at a bulletin board containing information on job posts at a job fair held in the southeastern port city of Busan. (Yonhap)

SEOUL, Jul. 24 (Korea Bizwire) — A debate on extending the retirement age is emerging as a major social issue, but even the current 60-year-old age-limit system is not being put to use by most companies.

According to a survey of 382 companies conducted by job matching platform, Saramin, only 39.5 percent said they were implementing the age-limit system.

However, of the 151 companies which responded that they have an age limit retirement system, only 32 percent of the employees actually work until they reach the retirement age.

Specifically, 51.7 percent of the companies, which is the majority, said “less than 10 percent” of the employees work until the retirement age.

The average age at which employees of these companies actually retire was 49, as much as 11 years younger than the retirement age set by law.

Furthermore, only 22.5 percent of the companies had a plan to extend the age-limit system to over 65, an proposal which has increased in popularity recently.

What do companies think about the mandatory retirement age law, which sets the age limit for retirement?

More than half (59.9 percent) of human resources managers thought the law would be ineffective due to the “realistically implausible environment supporting work until the retirement age.”

In addition, 78 percent of the respondents said that nothing much has changed in companies’ average age of retirement since the introduction of the mandatory retirement age law.

“When a retirement age system is implemented, the expertise of experienced workers naturally passed on to young employees, and the sense of stability of employees increases, thus activating the organization,” an official from Saramin said.

The official further added that companies need to actively utilize the retirement age system as employees can improve their performance through the stable management of workforce.

D. M. Park (dmpark@koreabizwire.com)