Economically active are getting older all the time
The Korean government is considering expanding the definition of its working-age population from people between the ages of 15 to 64, to 15 to 69.
Demographically, Korea's working-age population is shrinking, which could slow the country's economic growth. According to data compiled by Statistics Korea, the country's working-age population will be cut in half in the next 50 years.
Specifically, the country’s working-age population totaled 37.38 million in 2020, or around 72.1 percent of the total population. That number is expected to be only 33.81 million in 2030; 28.52 million in 2040; 24.19 million in 2050; and 20.66 million in 2060. In 2070, the working-age population will be 17.37 million, making up only 46.1 percent of the total.
The Organisation for Economic Cooperation and Development (OECD) predicted that Korea’s potential growth rate, which stands at 2.35 percent this year, will fall to 0.92 percent in 2033, minus 0.02 percent in 2047, and minus 0.08 percent in 2060, if the current situation lasts. A potential growth rate refers to the maximum possible rate an economy can grow without triggering inflation.
During the same period, the OECD's average, which is 2.62 percent this year, will only decrease to 1.47 percent.
The expansion of the definition of the working age population can be part of a solution, the government said.
In fact, the number of working senior citizens is on the rise.
Around 55.1 percent of seniors between the ages of 65 and 69 participated in economic activities in 2020. That statistic has, in face, been growing rapidly in recent years, as it was only 39.9 percent in 2008 and 42.2 percent in 2017.
But analysts say that if the government wants to change the definition of the working population, it must consider other issues like extending the country’s legal retirement age, which is currently 60.
“From an economic standpoint, the expansion of the definition of the working-age population is inevitable since the country defines elderly as those ‘who can not participate in labor activities' or ‘who need help from the government,’” Kim Young-sun, a gerontology professor at Kyung Hee University’s Graduate School of East-West medical Science, said.
“If the government wants to push for that change, it should also discuss some other issues at the same time including the extension of the retirement age.”
BY IM SOUNG-BIN, SOHN HAE-YONG AND SARAH CHEA [firstname.lastname@example.org]