South Korea witnessed an unprecedented increase in workers over 70. (Image courtesy of Yonhap)
SEOUL, Jul. 15 (Korea Bizwire) – In the first half of this year, South Korea witnessed an unprecedented increase in workers over 70, highlighting the country’s rapidly aging workforce and sparking debates about extending employment for older citizens.
According to data released by Statistics Korea on July 14, the number of employed individuals aged 70 and above surged by approximately 150,000 compared to the same period last year, reaching 1.92 million. This marks the largest increase since the agency began tracking this demographic in 2018.
The overall employment landscape showed a growth of 220,000 jobs across all age groups, bringing the total number of employed individuals aged 15 and over to 28.45 million in the first half of 2023. However, this increase was primarily driven by older workers, with those in their 60s and above accounting for 282,000 new jobs.
In stark contrast, youth employment (ages 15-29) saw a significant decline of 115,000 jobs, the steepest drop since the onset of the COVID-19 pandemic in 2020. The 40-49 age group, often considered the backbone of the economy, also experienced a decrease of 82,000 jobs.
The quality of jobs for older workers remains a concern. Recent studies indicate that many middle-aged and older individuals tend to transition into lower-skilled, lower-paying positions after retirement from their primary careers.
In response to these trends, the Organization for Economic Cooperation and Development (OECD) has advised South Korea to extend working lives and increase elderly employment to boost GDP and improve fiscal performance.
The OECD recommends implementing a flexible wage system based on job characteristics and performance rather than age, and limiting honorary retirement practices.
The Bank of Korea has warned that the retirement of the second generation of baby boomers (born 1964-1974) could potentially lower the country’s economic growth rate by up to 0.4 percentage points. The central bank emphasized the need for policies to support the utilization of this demographic to enhance growth potential.
Experts are calling for urgent social discussions on various forms of employment extension, including continued employment systems and raising the retirement age. The government plans to develop a “continued employment roadmap” in the second half of this year, which may include raising the legal retirement age from the current 60 years.
M. H. Lee (mhlee@koreabizwire.com)
