Elderly employment in Korea reaches record high due to low pensions

[Photo by Lee Chung-woo]

About half of South Korea’s elderly population, who recieve any type of pensions, including national and private pensions, are reported to be working due to low pension amounts compared to their living expenses.

According to an analysis by Maeil Business Newspaper of Statistics Korea data on Wednesday, among pension beneficiaries in the age bracket of 55 to 79, a total of 3,908,000 individuals remained in the workforce this year, marking the highest number on record. More than half of the pensioners are employed for the first time, with 50.2 percent in the workforce.

The number of working elderly pensioners was 2,524,000 as of 2017. However, a decrease in real income, coupled with the nation’s low birth rates and one of the world’s fastest rates of population aging, has led to a 46.7 percent increase in the number over the past six years. The estimated average monthly pension receipt for pensioners is 1.5 million won ($1,100) per month for a household of two people.

Experts suggest a revision of the national pension system by increasing the insurance premium rate and the income replacement rate, while also implementing labor reforms to expand elderly employment. In this regard, the Ministry of Health and Welfare will announce a comprehensive national pension operation plan, which will include future reforms.