Korea: Government To Raise Retirement Age

According to a report in the Korean Herald, the government plans to raise workers' retirement age as one prong of a strategy to fend off anticipated labor shortages. Another prong is to reduce the length of compulsory military service.

With respect to retirement, the government will push measures to extend the retirement age by five years--raising the age for receiving public pension payments by five years to 65 by 2033; currently, Koreans on average retire at 56.8 years of age. In addition, the government will provide support for employers to allow their workers to retire later and also remove some discriminatory rules against senior workers.

Source: The Korea Herald "Seoul to raise retirement age" (February 6, 2007)

Korea: China and Japan Compete for IT Workers To Replace Aging Workers

Korea, which is having its own aging problems, is losing a significant number of workers to non-Korean employers overseas due to job shortages, according to DongA.com. Moreover, Korean companies are not making enough systematic efforts to retain workers.

China is eying Korea’s high-tech workforce who they think will boost its industrial growth. Grappling with an aging population, Japan is looking for workers who will help relieve itself of the burden of workforce shortages.
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Japan is luring more Korean workers to enhance its IT competitiveness and resolve its workforce shortages problem caused by aging. Indeed, the Japanese government and businesses are making hard efforts to recruit Korean and Chinese IT workers under the second-phase “e-Japan” project whose main objective is Japan’s comeback as an IT powerhouse.

Source: DongA.com "China, Japan Inc. Recruiting Koreans" (December 23, 2006)

Korea: Aging Scientists Brought on Board To Help Smaller Firms

According to an article by Park Bang-ju, in the JoongAng Daily, under a Korean government program, "small and medium-sized companies in Korea are getting the chance to harness the experience and know-how of scores of recently unretired scientists." Specifically, it reports that the Science Ministry has announced yesterday the names of 79 scientists to be brought out of retirement and of 79 companies where they will work. "Scientists who had worked at a state research facility for 20 years or more were invited to apply via the Internet for posts as technical advisors."

Source: JoongAng Daily "Elders get last hurrah at small domestic firms" (September 5, 2006)

Korea: Over-50 Workforce Becomes Largest Segment

According to Korea's National Statistical Office (NSO), the number of workers over 50 surpassed the working population of those in their 30's and 40's for the first time--the number of workers over 50 stands at about 6.5 million, or 27.7% of the workforce, as compared to 6.2 million, or 26.5%, in their 30's and 6.45 million, or 27.6%, in their 40's. Out of workers over 50, 3.89 million were in their 50s and 2.61 million were over 60.

Source: The Hankyoreh "People over 50 emerge as mainstream workforce" (July 18, 2006)

Korea: Leaders Adopt Social Convention Aimed at Aging Population

Seo Dong-shin reports in The Korea Times that, after five months of discussion among business, labor, and religious and civic groups, Koreals government has adopted a social accord aimed at battling problems arising from Korea's falling birthrate and aging population. Among other things, "labor and business circles, for their part, will attempt to create more job opportunities for women and seniors, according to the accord."

The government has also agreed to continue discussion on ways to extend the retirement age of workers, while labor and businesses will negotiate on how to improve the retirement and wages system.

Source: The Korea Times "Korea Adopts Social Pact to Battle Low Birthrate" (June 20, 2006)

Aging and National Credit: Standard and Poor's Reviews Global Graying

On May 31, 2006, Standard & Poor's Ratings Services published a report outlining various simulations through 2050 of the fiscal and hypothetical sovereign ratings implications for 32 sovereigns, including all 25 EU members, as well as Canada, the United States, Australia, New Zealand, Norway, Japan, and the Republic of Korea. While the commentary article "Global Graying: Aging Societies and Sovereign Ratings" is only available to subscribers to S&P's RatingsDirect, they have also been publishing country by country reports, some of which speak to aging workforce issues. Some of these (Germany, Belgium, France)are available for free to people who register at S&P's website and others have had some press coverage.

A key conclusion of the main report is the fall-out that ageing may have on government solvency. Without further adjustment either to the current fiscal stance or to pension and health care costs, the median general government net debt-to-GDP ratio for the sample will reach an overpowering 180% of GDP by the middle of the current century, from 33% in 2005.

Publically available country specific reports include:

• United States
• New Zealand
• Japan
  

Source: Globe & Mail "Nations get 'wake-up' call about aging workers" (June 6, 2006)

Asia: University of Chicago Executive MBA Program Attracts Older Ages

Writing in The Korea Times, Chung Ah-young reports on an executive MBA (EMBA) program that will help seniors successfully continue developing their business skills over their long careers in an aging society. According to the article, "Beth Bader, managing director of the EMBA Asia program of Graduate School of Business of the University of Chicago in the United States, said getting an adult education and continued investment in oneself, through the EMBA course, are crucial in almost any field, for successful long-term careers."

``People begin to realize they don’t want to spend their whole or half their life just declining as they are getting older. In a sense, they can reinvent themselves, if they want to do that. Or they can make a very significant jump in their abilities and flexibilities in the very specialized business program,’’ Bader said.

She stressed that in societies with aging populations, people hope to work longer.

``That’s why I predict more demands for the EMBA course for older ages and more mature-aged students here in Korea and other aging countries. Particularly, business in Korea has been much more mature. People are going to need to work a lot longer than they have done in the past. I think it has happened already in the United States,’’ she said.

Source: "Executive MBA Program Targets Seniors" The Korea Times (February 1, 2006)

Korea: New Labor Statistics Show Aging of Workforce

According to an article by Kim Sung-jin in The Korea Times, Korea's The National Statistical Office (NSO) said on January 23 that the number of 40-49 year old workers outstripped the working population aged between 30 and 39 years olds for the first time ever.

"The age of the newly employed in Korea’s manufacturing industry averaged 37.6 years in 2004 and would grow to 50 years by 2030 due to the rapidly aging trend and low birthrate of the Korean society," said LG Economic Research Institute (LGERI) vice president and economy research division chief Oh Moon-suk.

"Such trends call for urgent research into ways to raise the productivity of elderly citizens to tackle the declining potential economic growth rate problem in the short-term, and reinvigorate the birthrate to cope with the problem in the long-term," Oh said.

LGERI has suggested that adoption of a wage peak system and extending the retirement age could help the elderly from remaining economically inactive.

Source: "40-Somethings Emerge as Key Workforce" The Korea Times (January 23, 2006)

South Korea: Aging Workforce and Global Competitiveness

The Korea Institute of Industrial Technology Evaluation and Planning (ITEP) is reported as finding that that Korea’s manufacturing workforce will soon begin to age at a quicker rate, and like Japan, people in their early 50s will make up the biggest share of the working population in the manufacturing industry in the next 5-10 years. According to an article by Kim Sung-jin, ITEP notes that "With the pool of workers expected to decrease in coming decades due to declining fertility and longer life spans, the Korean working-age population will face twin challenges of supporting retired elderly citizens and boosting productivity to maintain economic growth."

Source: "Aging Workforce Poses Big Challenge to Economic Growth" Korea Times (March 2, 2005)