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South Korea’s aged are working till later in life and present the very best employment price amongst member international locations of the Group for Financial Cooperation and Improvement (OECD). Nevertheless, an evaluation means that this excessive employment price is pushed primarily by subsistence-based labor to safe dwelling bills fairly than by “the enjoyment of working.”
Based on the Nationwide Pension Analysis Institute’s report titled “The Nationwide Pension and Labor Provide Among the many Aged,” South Korea entered a super-aged society in 2025, with the inhabitants aged 65 and over accounting for 20.3 %. On the similar time, the employment price for these aged 65 and over stood at 37.3 %, far exceeding the OECD common of 13.6 %. It was additionally greater than Japan’s 25.3 %.
A Statistics Korea survey confirmed that the typical desired working age for the aged was 73.4. Greater than half cited “to assist cowl dwelling bills” at 54.4 % as the explanation they proceed to work. “The enjoyment of working” at 36.1 % and “relieving boredom” at 4.0 % have been comparatively decrease.
The report cited the problem of sustaining fundamental dwelling requirements with pension advantages alone as the most important motive. As of 2024, the typical Nationwide Pension payout was about 660,000 gained (roughly $450), which doesn’t attain even half of the minimal month-to-month dwelling value for a single-person family, 1.34 million gained. Not like Western international locations, the place people usually select retirement after starting to obtain pensions, in South Korea the system successfully forces folks to proceed working even whereas receiving pension advantages.
The hole between the statutory retirement age and the precise retirement age was additionally recognized as an issue. Though the authorized retirement age is 60, the typical age of retirement from main employment is 52.9, whereas pension funds are regularly being delayed from age 63 to 65. This creates an revenue hole of at the least 10 years, the so-called “revenue crevasse.”
A contradiction inside the pension system was additionally revealed. The “discount of old-age pension advantages because of income-earning actions” system, which reduces pension funds by as much as 50 % when a sure stage of revenue is earned, has lengthy confronted criticism for creating the notion of “working is a loss.” Nevertheless, the report defined that as a result of the reductions apply primarily to high-income earners, the impression on weakening the general willingness to work among the many aged is proscribed. For a lot of aged folks urgently in want of dwelling bills, re-entering the labor market is unavoidable even when it means accepting the discount.
In the meantime, the “deferred pension system,” which will increase pension advantages by 7.2 % yearly when pension fee is delayed, was analyzed as an element that expands labor participation among the many aged. If well being permits and jobs can be found, deferring retirement turns into a viable possibility.
The report emphasised that in a scenario the place inhabitants decline is intensifying labor shortages, the labor pressure of the aged is a nationwide useful resource. It beneficial insurance policies that transcend a easy dialogue of extending the retirement age and as a substitute urgently present high quality jobs that may fill the interval between job loss within the early 50s and the beginning of pension funds. It additionally famous that, like Japan, which requires firms to ensure employment till age 70, South Korea wants an setting during which aged folks can work on the inspiration of “secure previous age” fairly than “working to outlive.”
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