Generations in conflict
A senior colleague of mine is worried sick about his son who has been repeatedly rejected in job bids. He graduated from an elite school in Seoul with a degree in business management. His grade-point average was a commendable 3.5. My friend thought his son would not have any problem landing a job after graduation. But he has been rejected from all the companies he applied to. I too am a parent and couldn’t help but sympathize with him.
Some would say it is a positive trend that the names of a few prestigious schools in Seoul count less these days in the job market. But graduates from colleges across the board aren’t doing well in their recent job hunts. People with engineering and science degrees are somewhat better off than those who majored in the humanities. But the reality is that the job market is hell.
The son of my acquaintance has not been successful in his job hunt not because school names matter less but because jobs are scarce. Since the global financial crisis in 2008, the Korean economy has been growing at 2 to 3 percent on average every year. Companies have moved abroad to build factories to use cheaper labor. The services sector remains underdeveloped, bound by a myriad of regulations. There is simply no place for growth in jobs.
Young people these days have studied more rigorously than generations before and are amazingly clever. Interns come with incredibly impressive resumes and experiences. Yet they still don’t get hired. The young could feel resentful toward the adult generation for messing up the economy. But the older generation also has complaints. They have spent all their earnings to give the best possible education to their children. Korean middle-aged men became a species dubbed “goose fathers,” who stayed behind to work and fund schooling for children who traveled abroad, accompanied by their mothers, to study in English-speaking countries. Few can afford to save for their futures. When they lose their jobs or are retired early, they have no means of living. According to research by KB Financial Group, each family needs 2.18 million won ($2,010) a month to sustain post-retirement life. On average, they have 910,000 won.
They are desperate to stay on the payroll as long as possible. A recent law requires companies with more than 300 employees to extend the retirement age to 60 from 2016. Smaller companies must make similar arrangements from 2017. Retirement extensions are an action aging societies will have to take.
There is, however, a catch. Employers have to worry about the spike in labor costs because they must keep veteran employees longer. This translates into less room for younger people to get into companies. The number of workers on permanent payrolls aged 50 and higher totaled 2.37 million this year, exceeding the 2.29 million people in their 20s for the first time. Companies are reducing their hiring to save up for extensions of retirements. A father keeps his job at the expense of his child’s.
Another sensitive issue in an aging society is pensions. If the older generation continues receiving the current level of pensions, there won’t be anything left for their children by the time they retire. The younger generation may end up getting nothing even though they have made monthly contributions throughout their working days. The essence of pension reform is a simple choice - either we go on getting what we used to get regardless of the consequences for future generation or settle for less to leave enough for our children. The older and younger generations inevitably are up against one another. Parent and child are fighting over their own livelihoods. The contest could be more bitter and unpleasant than any previous ideological and regional conflict as it involves the means of a basic living.
The reality is gloomy and demoralizing and without any clear-cut solution. If the economy grows at a 5 to 6 percent pace, parents will be comfortable in their retirements and young people won’t worry about getting jobs. But that is far-fetched. We must face up to the reality that the pie has gotten smaller. There is no other way but to content ourselves with smaller pieces. The older generation must accept more modest pay in return for working more years. They can’t take away opportunities for young people. Humans are selfish by nature, but this time we must be more yielding.
The same goes for pensions. It is not just the controversial money-losing government employees’ pension system that we’re talking about. All pensions are vulnerable. There is no other way than paying more and settling for less. Otherwise the pension schemes cannot last. Both parent and child could end up on the street. We must find a way that can save us all.
JoongAng Ilbo, Nov. 10, Page 28
The author is the acting editor-in-chief of the JoongAng Ilbo.
by Koh Hyun-kohn
More in Columns
China’s thin skin
The Korean War from China’s view
Who’s laughing now?
Fighting Chinese patriotism
The curse of the presidency