Seniors to make up 38% of population
Research forecast Monday that Korea will become the world’s most aged society by 2050, raising an urgent need to prepare a safety net for the elderly and cope with a shrinking labor force.
People aged 65 or older are predicted to make up 38.2 percent of Korea’s total population in 2050, according to the report by the Korea Institute of Finance, more than tripled compared with 11 percent last year.
Based on the United Nations’ standard, the country will become an aged society in 2018 and a super-aged society in 2026, in which people aged 65 or older account for more than 14 percent and 20 percent of the total population, respectively.
That means it would take Korea eight years to change from aged to super-aged, far faster than other advanced countries such as France with 39 years, the U.S. with 21 years and Japan with 12 years.
The state-run think tank estimated the average life expectancy of Koreans at 83.5, compared with 82.6 of Japan, 81.5 of France and 78.4 of the U.S., as seen in World Bank data.
The speedy demographic transformation could hurt the country’s future economy and already fragile safety net for elderly provisions, the report noted.
“The changes in social structure accompanied by rapid aging could dwindle Korea’s growth potential,” it said.
“There is also a strong possibility that it may weigh on the country’s fiscal health,” the report said.
The Korea Development Institute forecast the nation’s potential growth rate to fall to 0.74 percent in the 2040s, down from 4.56 percent from 2003-2013, due to a reduction in workforce and capital flows.
The government’s total expenditure is expected to go up 37 percent in 2020 from 2008 because of increased social security spending, but tax revenue would grow only about 15 percent for the same period, the National Assembly Budget Office reported earlier.
But Korea would see service sectors arise as the graying population creates new demand for asset management, health care, travel, security and other products, KIF said.
By Shin Hyon-hee (email@example.com