[Retirement Extension, Time to Choose] Labor: "Gained Time to Prepare for Retirement" Company: "Retaining Skilled Technicians"

Reemployment Satisfaction Soars... A Look Inside KGM
Hwang Juwon at KGM's Pyeongtaek Plant
Retired at Mandatory Age, Rehired Under Company System
Starting Salary for New Employees, Employee Benefits Remain
"I May Be Retired, But I Still Feel So Young"

"If only I could be rehired as a full-time employee even after retirement..."

At KG Mobility (KGM), the wish of many employees approaching retirement is becoming a reality. The company introduced a reemployment system at the end of last year, and employees have shown high satisfaction with it. Of the 108 retirees at the end of last year, 103 expressed a desire to continue working, and the company accepted all of their requests.

On May 2, at the KG Mobility (KGM) Pyeongtaek plant's body quality line, silver-colored vehicle bodies continuously moved along the conveyor belt. Automated robots assemble the car doors at designated positions, but slight misalignments can occur between the doors. Hwang Juwon (61), who works for the company, is responsible for checking these discrepancies and making precise adjustments.

Using a gap measuring device, Hwang measured the height difference between the front and rear doors, then struck the connection point of the front door with a metal hammer. With a single adjustment, the gap with the rear door was perfectly aligned. This was the expertise gained from 38 years of experience in bodywork, allowing him to sense differences of less than 1mm with his fingertips. Within the company, he is recognized as a highly skilled technician who knows everything there is to know about vehicle bodies and automotive steel sheets.

Hwang Juwon, who was rehired after retiring at the end of last year, is inspecting a vehicle body on the body quality line at the KG Mobility Pyeongtaek plant on the 2nd.

"If the vehicle body parts don't fit together properly, the car won't look good in the end. Ordinary customers may not notice, but we can immediately tell when there's a problem. Even if just a few out of over 3,600 welds on the body are faulty, the car will rattle, which shows just how critical the body is." This is expertise that comes from a high degree of proficiency in his work.

Income gap before receiving the National Pension is a burden

Salary decreased by 40%, but gained about a year of flexibility

Time needed to prepare at home as well

Plans to seek employment even after reemployment ends

System introduced last year despite opposition from younger employees

Company prioritizes securing high quality

Advantage of operating highly skilled workers at reasonable labor costs

Number of new hires remains in double digits

Born in 1964, Hwang retired at the end of last year. However, instead of leaving the company, he chose to be rehired for one year. This was possible because KGM introduced a system at the end of last year to rehire technical retirees. Any applicant can work for one year after retirement. Unlike extending the retirement age, which increases salary with seniority, reemployed workers receive the starting salary of a new employee. This is only about 60% of the salary received just before retirement. However, as regular employees, they retain benefits such as production incentives and other employee welfare. They can also join the labor union. Hwang is one of the 103 people who were rehired.

There were several reasons why Hwang applied for reemployment. The biggest factor was that he still felt capable of working even after reaching retirement age. He explained, "Although I retired, I still feel very young. I thought I should work a bit longer," describing his motivation for applying for reemployment.

Hwang Juwon, who was rehired after retiring at the end of last year, is inspecting a vehicle body on the body quality line at the KG Mobility Pyeongtaek plant on the 2nd.

The gap between retirement and receiving the National Pension was also a burden for him. Currently, the age to start receiving the National Pension is 62 for those born up to 1960, and it has been delayed to 63 for those born between 1961 and 1964. In Hwang's case, he will start receiving his pension in 2027, which means there will be about a two-year income gap after retirement. He said, "I have a private pension as well, but it will only kick in around age 65, so I needed to find a way to work in the meantime. Thanks to the reemployment system, I was able to buy myself about a year," he said with a smile.

Although Hwang's take-home pay has dropped significantly compared to before retirement, he takes comfort in the fact that he has gained a year of flexibility. He said, "I'm receiving the starting salary of a new employee, and my pay has dropped by more than 40% compared to before. Still, families need time to prepare for reduced income, and reemployment has at least given us about a year to adjust."

According to company policy, Hwang plans to seek employment again after his reemployment period ends. He noted that colleagues who left the company earlier are now working for virtually minimum wage. He expressed regret that he would likely have to follow a similar path. Hwang also said, "In places like Europe or Japan, there is no retirement age. Since the age to receive pensions is being delayed here as well, we should raise the retirement age to at least 65."

When asked whether extending the retirement age might reduce new hiring, he said, "It is unfortunate that young people can't get jobs because retirees stay on. However, with the National Pension running out, we can't just do nothing. To soften the impact of extending the retirement age, we need to increase it gradually."

Kang Donghee (58), a junior colleague approaching retirement, said, "When the company was under court receivership and going through hard times, I took a month off and tried finding work outside, but no one would hire me." He believes the reemployment system is positive for both employees and the company.

However, he added, "I have a 30-year-old daughter and a 25-year-old son, and when we talk, there's a dilemma for young people: retirees need to leave for jobs to open up. Since neither individuals nor companies can solve this, the government needs to address it legally."

Previously, KGM operated a "veteran" system, hiring highly skilled retirees on one-year contracts. However, since the new opportunities often involved taking on undesirable, physically demanding tasks, many left before their contracts ended. The system was therefore improved so retirees could continue in their previous roles.

The introduction process was not easy, as there was significant opposition from younger employees. Kwon Seungoh, head of planning and public relations at the KGM labor union, said, "From the perspective of junior employees, they could only hire new staff if the seniors left, so there was strong opposition. Although the decision was made by majority vote, many younger employees still do not understand the reemployment system."

KGM continues to hire new employees in double-digit numbers. By rehiring experienced workers, the company can significantly reduce costs while maintaining new hiring. A KGM representative said, "Our top priority was to secure assembly quality by utilizing the know-how of experienced workers on the production line. The reemployment system has boosted employee loyalty and helped reestablish pride in the company. It is also a major advantage to operate highly skilled workers at reasonable labor costs."

Hwang Juwon, who was rehired after retiring at the end of last year, is inspecting a vehicle body on the body quality line at the KG Mobility Pyeongtaek plant on the 2nd.