Performance-based wage system needed for elderly workers: KDI

[Photo by Yonhap]

South Korea should introduce a performance-based wage system for elderly workers who end up working in low-skilled, low-wage jobs after retirement, an analysis showed on Thursday.

The Korea Development Institute (KDI) analyzed job changes by age group using data from the Korean Labor & Income Panel Study (KLIPs) spanning from 1998 to 2021 to determine how efficiently middle-aged labor is utilized in the labor market.

The report categorized jobs into five types: analytical, social, service, repetitive, and physical.

The analysis of male workers aged 20 to 75 revealed that their propensity for analytical, social, and service jobs decreases with age, while the propensity for repetitive physical jobs increases.

KDI suggested expanding the adoption of a performance-based wage system, rather than a seniority-based one, to better utilize middle-aged labor.