The Proportion of Elderly Job Seekers Increased by 12.5%P During Moon Administration

The More Short-Term Public Jobs Increase, the More Involuntary Unemployed Rise in a Vicious Cycle

[Sejong=Asia Economy Reporter Moon Chaeseok] Since the launch of the Moon Jae-in administration, the proportion of unemployed people aged 65 and over who have stopped working due to involuntary reasons such as business closures and have started job-seeking activities has increased every year. The elderly population mainly holds public jobs created by the government or local governments, but they reappear in the job market every time their job contracts end. There are concerns that increasing short-term public jobs will only continue to produce involuntary unemployed individuals.

On the 23rd, Asia Economy analyzed microdata from the Statistics Korea Economically Active Population Survey and found that the number of unemployed people aged 65 and over last month was 421,000, which is 2.8 times higher than the 112,000 recorded in January 2018, right after the current government took office. Among them, those who became unemployed due to unavoidable reasons such as business closures or exhaustion of work, despite wanting to continue working, increased from 82,000 to 361,000 during the same period.

The proportion of involuntary unemployed among all unemployed rose by 12.5 percentage points, from 73.2% to 85.7%. If 73 out of every 100 people aged 65 were unemployed job seekers three years ago, last month that number rose to 85.

This result greatly contradicts the government's intention to secure income for the elderly by expanding public jobs. So-called 'artificial jobs' temporarily increased employment, but when the work disappears, there is a high possibility that these individuals remain in the job market as 'unemployed.' This means that the number of elderly people engaging in job-seeking activities will gradually increase as public jobs expand.

The problem is that the government is still repeating employment policies focused on short-term public jobs. The government has announced plans to create 900,000 direct jobs in the first quarter. Direct jobs are projects that provide temporary jobs such as public work by releasing finances.

Since the current government took office, elderly jobs have steadily increased. For example, the number of jobs in elderly and social activity support projects under the Ministry of Health and Welfare was 510,000 in 2018, expanded to 640,000 in 2019, and further increased to 740,000 and 800,000 in the last year and this year, respectively. Among the 800,000 jobs this year, 73.8% are public jobs.

Experts agree that considering the accelerating population aging, more fundamental employment measures for the elderly aged 65 and over must be established.

Professor Geum Jae-ho of Korea National University of Education said, "Along with strengthening vocational training for the elderly aged 65 and over, serious discussions should be held on proposals such as differentiated minimum wages by age, similar to the wage peak system."

There is also an opinion that, since demand may overlap between the elderly aged 65 and over and youth and women in the high-income information and communication technology (ICT) job market, it is urgent to prepare a 'job matching' policy that allows the elderly to be re-employed by utilizing their existing experience in construction, manufacturing, and other industries.

Professor Yoon Dong-yeol of Konkuk University’s Department of Business Administration advised, "Due to the expansion of COVID-19, it is difficult to secure foreign workers, so elderly people should be placed in small and medium-sized enterprises facing severe labor shortages. It is important to find and match jobs in construction, manufacturing, and other fields where the elderly were employed before losing their jobs."