"Senior Business Must Integrate Digital to Succeed" [Issue Interview]

Interview with Professor Park Young-ran of Gangnam University Department of Silver Industry

According to the Korea International Trade Association, the domestic senior industry market size is expected to grow more than twice, from 72 trillion won in 2020 to 168 trillion won in 2030. As a super-aged society where more than 20% of the population will be elderly approaches, the proportion of elderly consumers will increase, and companies that offer products or services targeting the elderly will gain competitiveness and expand their scale.

Professor Park Young-ran of the Silver Industry Department at Gangnam University, whom I met on the 5th, emphasized the "integration of technology" regarding current senior business trends. She explained, "It has become an era where success is difficult without DX (digital transformation). Especially in the care business, there is a shortage of manpower while the age group requiring care is increasing, so there is growing expectation to fill that gap with technology."

The Silver Industry Department, where Professor Park works, was established at Gangnam University in 2006 to prepare for a super-aged society. Based on business administration and gerontology, it trains experts in senior finance and senior healthcare, as well as talents who develop elderly-friendly products and services across various industrial fields. Professor Park graduated from Yonsei University with a degree in Journalism and Broadcasting, earned a master's degree in social work from the same university's graduate school, and later obtained a Ph.D. in social welfare from the University of Washington in the United States. Currently serving as a private member of the Low Fertility and Aging Society Committee, she has been involved since the department's inception and has witnessed the growth of the senior industry.

Professor Park Young-ran, Department of Silver Industry, Gangnam University.

- From your perspective of observing the senior industry’s development for nearly 20 years, are there any notable turning points?

▲ The enactment of the Elderly-Friendly Industry Act and the Long-Term Care Insurance Act for the Elderly in 2006-2007, and the discussion of the Fourth Industrial Revolution at the 2016 Davos Forum seem to be two turning points in the senior industry.

Concerns about economic growth slowing down due to accelerated aging were already raised in the mid-2000s. There was a consensus that since productivity would decline and the economy would shrink, industries targeting the elderly should be activated to become a growth engine. That led to the introduction of the Elderly-Friendly Industry Act. However, the direction shifted somewhat with the Long-Term Care Insurance Act for the Elderly. For example, when purchasing welfare supplies now, the government supports most of the costs under this law. But since support is limited to 18 items, the path for diverse and competitive products to emerge was actually blocked. In short, creating a "money bag" had a counterproductive effect. After the 2016 Davos Forum’s discussion on the Fourth Industrial Revolution, a digital transformation boom occurred in all sectors, including the senior industry. I recall that research and development (R&D) on digital healthcare increased significantly thereafter.

- The concept of "age-tech," which bundles technologies for the elderly, has even emerged.

▲ That’s right. In that sense, ‘platform business’ seems to be rising these days. Even without deep knowledge of the senior industry, people who are proficient in IT or have expertise in distribution can create good business ideas by connecting platform business concepts and know-how to the tech field.

- What do you think is the current status of Korea’s silver industry?

▲ It has developed much more than before. As the number of young people decreases absolutely and the elderly increase, interest in senior consumers is unavoidable. However, companies now tend to avoid the word ‘silver.’ The term ‘active senior’ has started to be used to mean a generation with both leisure time and economic power, so ‘senior’ is used more often than ‘silver.’

- Still, the concept of the senior industry is not yet well established, so is it difficult to recruit students for the department?

▲ For teenagers applying to university, ‘senior’ is a distant topic. Moreover, even if large companies engage in senior business, they assign existing personnel rather than hiring people who studied the silver industry specifically for that business. Some executives and employees responsible for senior business later take graduate courses related to seniors.

It is still not easy, but better than before. Since we recruited the first class in 2006, we have produced just under 1,000 graduates. Some graduates have been employed by senior business startups, and these companies have recently been gaining a foothold in the industry. Examples include 'Hyodol,' a silver care AI robot developer awarded at MWC 2024; 'Jinaem,' which builds high-end senior residences; 'Daekyo New Eap,' Daekyo’s senior total care service brand; and 'Caredoc,' which has attracted over 30 billion won in cumulative investment. Companies that have hired our graduates tend to keep coming back. Students who have built expertise in the Silver Industry Department bring useful data on elderly consumers or provide new insights.

- As new senior business models increase, investment funds seem to be pouring in.

▲ Startups integrating technology into senior business are emerging here and there, attracting investors. From my perspective working in this field, it is good news, but I also think there is a lot of hype. I have both doubts and expectations about whether all places receiving investment under the name of age-tech will succeed. I also wonder if the purchasing power of active seniors is overestimated. This is something to watch.

- From the aging perspective, the government seems to pay much attention to low birth rates but relatively less to elderly issues.

▲ That’s because it is not a government priority agenda. If you look at aging society policies, there are many excellent contents. However, the responsible departments are spread across multiple ministries, and they show little interest in elderly issues. The problem is that they do not see their work as ‘elderly-friendly’ business. For example, the Ministry of Employment and Labor has created and continues to implement policies related to middle-aged and older employment. But they basically take the stance of “only the working-age population under 65 is our responsibility.” Recently, programs for job transition support and employment support packages for the elderly have been introduced, but fundamentally, they say, “If you are over 65, check the Ministry of Health and Welfare’s senior job projects.” Each policy operates under different laws, so this approach will not properly address the elderly issues that will continue to arise in the future.