[THE INVESTOR] The employment rate of South Koreans in their late 50s and early 60s is much lower than that of Japan on account of lax policy measures, a report said on June 28.

The employment rate for South Koreans aged 55 to 59 came to 70.6 percent in 2015, compared with 83.4 percent for Japan, according to the report by Hyundai Research Institute.

The rate for South Korean citizens aged 60 to 64 stood at 59.4 percent, also lower than Japan’s 62.2 percent. However, the figure for those aged 65 and older reached 30.6 percent for South Korea, trumping Japan’s 21.7 percent.


Japan’s high senior employment rate was attributed to its policy measures to support job searches by the elderly.

After introducing a law to tackle population aging in 1995, Tokyo started spending state funds on helping senior citizens land jobs in 1997, with the related budget growing at an annual average rate of 4.7 percent since. This year’s budget stands at 7.69 billion yen (US$75.4 million).

Starting in 2006, Japan also required companies to adopt one of three options for senior workers: abolishing the mandatory retirement system, extending the retirement age or allowing employees work as temps after retirement.

Lee Bu-hyung, an HRI economist, said the government should not only establish a detailed policy network to help boost the employment of seniors, but also come up with measures to ensure that increased senior employment will not lead to a drawdown in youth employment.

“An increase in senior employment is the most effective way to reduce the social burden ranging from medical care to welfare and pensions,” he said.

As of this year, some 4.92 million people are aged 55 to 64 in South Korea that has a total population of 50.62 million, according to government data.

In an effort to tackle the country’s rapid population aging, Seoul extended the retirement age to 60 in 2015. Companies with 300 or more employees are required to adopt the system starting this year, while companies that hire fewer than 300 workers are obliged to adopt it starting in 2017.

(theinvestor@heraldcorp.com)