[Inside Chodong] To Raise the "Elderly" Age Standard to 75...

Many Benefits Start at Age 65, Including Basic Pension
Concerns Over Worsening Elderly Poverty Rate, Among the Highest in the World
Need to Consider Measures to Prevent Welfare Blind Spots

Lee Jung-geun, the 83-year-old chairman of Booyoung Group, officially proposed to the government on the 21st to gradually raise the elderly age from the current 65 to 75, increasing by one year annually, upon his inauguration as president of the Korea Senior Citizens Association. As the largest senior organization in the country with 3 million members, it directly raised the issue of redefining the criteria for the elderly ahead of entering a super-aged society.

Responding to Chairman Lee's proposal, Prime Minister Han Duck-soo said the next day that he would consider raising the elderly age as an important issue. He stated, "Our stark demographic structure, the ratio between the elderly and the young in 2040 or 2050, will affect our economy, society, and security sectors. We need to seriously examine this issue and prepare in advance."

By next year, South Korea will enter a super-aged society where one in five citizens is aged 65 or older. This comes just seven years after becoming an aged society in 2018 (where the proportion of those aged 65 or older exceeds 14%). It is aging at an unprecedented speed, the fastest in the world. At the current rate, the elderly population, now about 10 million, will grow to 20 million by 2050. Last month, the number of employed seniors aged 60 and above reached a record high of 6.75 million, ranking first among all age groups, even surpassing those in their 50s. They are active not only in employment but also in entrepreneurship. In July this year, 95,000 startups were launched, a 1.5% increase compared to the same period last year, but startups by those aged 60 and above increased by 14.6% to 13,000. This is why academia, labor, and industry sectors unanimously agree that labor market structural reforms, including extending the retirement age, are inevitable.

However, raising the elderly age, which has been maintained for 43 years, is not a simple matter of changing numbers. Currently, in South Korea, once a person turns 65, they become eligible for various benefits such as basic pension and long-term care insurance. The criteria for free subway rides for seniors and senior vaccination also start at 65. The problem is that the number of beneficiaries of these elderly welfare programs is rapidly increasing like a snowball. It is clear that our society will struggle to support the elderly. Moreover, South Korea's elderly poverty rate (40.4%, defined as disposable income below 50% of the median income of the entire population) is among the highest in the world. The Korea Development Institute (KDI) predicts that if the elderly age remains unchanged, the burden of supporting the elderly will become the highest among OECD member countries after 2054.

Therefore, when raising the elderly age, it is necessary to consider ways to reduce excessive welfare burdens while preventing welfare blind spots. During the process of reducing existing welfare benefits, there must be no harm such as elderly poor people losing access to the basic pension. Companies point out that retirement age extensions should be reviewed alongside raising the elderly age. Raising the elderly age prematurely without securing jobs for the elderly could worsen elderly poverty. Above all, extending retirement age or creating elderly jobs should not threaten youth employment. This would only cause further class and social conflicts. Ultimately, a phased approach is needed that comprehensively considers various social welfare and economic conditions, with in-depth discussions and social consensus across all sectors, minimizing the impact on society. There is no need to excessively argue over who suffers more, the young or the elderly. Over time, we all eventually become elderly.