Chang, Jiyeun. (Korea Labor Institute)

Transcription

1 Chang, Jiyeun (Korea Labor Institute)

2 In 2000, Korea joined the ranks of the aging society in which individuals aged 65 and above account for more than 7% of the entire population. As of 2002, the size of the aged population is estimated at 3.77 million, or 7.9% of the nation s population. The number is expected to reach 14.4% by 2019, effectively branding Korea as an aged society. The speed of aging in Korea is unprecedented compared to that of the rest of the world. The world s fastest decline in birth rate, coupled with a rapid increase in average life expectancy, is translating into the world s fastest aging society. Up until now, the economic participation rate of the elderly population has been quite high in Korea. However, such a trend was attributable to the nation s weak welfare system as well as the fact that the proportion of workers either self-employed or serving in the agricultural sector is higher than in the developed nations. As such factors are now becoming less significant, the economic participation of the elderly is likely to decrease in the coming years. One of the most significant turning point that brought about the change was the financial crisis that struck the nation in the late 1990s. Economic participation of the aged population has been nose-diving steadily since then. Early retirement seems to be at least part of the reason, and it is worth watching whether the trend turns over into its previous state or continues on its current course to a long term low. Should Korea also experience a rapid increase in the number of retirees as was the case in the developed countries, the cost of supporting the aged population would go up, along with the burden on public welfare programs such as the national pension scheme and the national health insurance system

3 Until recently, the issue of the elderly worker did not receive much spotlight in the Korean society. The reason lies in the fact that the group was by far a much more active participant in the economic picture than in the developed nations, and therefore, did not ring up a significant unemployment number. When considering both male and female workers, they are the most economically active from the mid twenties into their early fifties. Since then, the activity level starts declining and slides down a much more negative slope in the late sixties. The Labor force participation rate of males 15 years old and above is 73.4%, and that of the 55~64 age group still quite high at 70.4%. However, the number declines dramatically to a mere 39.7% in the age group 65 years and above. The same goes for the female workers. The numbers for the overall female worker group and the 55~64 age group remain quite stable at 49.0% and 47.3%, respectively. The level of economic activity in the age 55 and above group in Korea is higher than that of the developed nations (Chang, 2000). Though the labor force participation rate of the elderly (55~64) in Korea is still quite high compared to that of other nations, the reason is suspected to be the high economic participation in the agricultural sector (Lee, Chul-hee, 2002). According to the statistics on the agricultural sector from reports on economically active workers in Korea, more than 85%

4 of people between the age of 50 and 65 are active, and the 65 and above group also marks 66%. But the landscape changes significantly in the non-agricultural sector where the participation rate of the late-fifties group, 59.4%, already lags behind that of their counterparts in the agriculture sector. The participation level of the group aged 65 and above is a mere 18.2%. Meanwhile, the rapid decline in the labor force participation rates since the 1997 crisis is worth noting. In the case of male workers, in particular, the participation rate of the 55~59 age bracket recorded 84.9% in 1997 but decreased by 7.2% points to 77.7% in During the same period, the 60~64 age group also suffered a loss of 8.7% point from 73.4% to 64.7%

5 The high economic participation rate of the elderly in Korea can be explained by the fact that, compared to the developed nations, the self-employed sector and the agricultural sector takes up a more significant portion of the labor market than in the developed nations. A substantial portion of the aged workers in employment is concentrated in the self-employment sector. In the 55~65 age group, 45.7% of men and 57% of women are non-wage workers, while the numbers climb to 72.2% and 75.2%, respectively, in the 65 and above group. The occupational categories with the most elderly workers are agriculture and non-skilled laborers. In the case of male workers, the agricultural & fishery sector and non-skilled labor sector have 25% and 20.4% of the workers, but there are also 11.7% of workers serving as highranking officials. In the case of women, the share of workers in the agriculture & fishery, non-skilled labor, and sales services sectors adds up to slightly less than 70%. Female workers in the agricultural sector exceeds 50% in the 65 and above group, and when combined with the number of workers in the non-skilled labor sector, 15~19%, the figure reaches the 70% level

6 <Table 1> Employment Status of Elderly Workers 55~64 Years 65 Years and Above Male Female Male Female Regular Employee 294 ( 21.6) 39 ( 3.9) 39 ( 6.6) 5 ( 1.0) Temporary Employee 185 ( 13.6) 194 ( 19.4) 63 ( 10.7) 44 ( 8.4) Day Worker 142 ( 10.4) 167 ( 16.7) 34 ( 5.8) 77 ( 14.8) Employer 118 ( 8.7) 29 ( 2.9) 28 ( 4.8) 3 ( 0.6) Self-Employed 606 ( 44.5) 262 ( 26.2) 397 ( 67.4) 220 ( 42.2) Family members working without pay 17 ( 1.2) 308 ( 30.8) 28 ( 4.8) 172 ( 33.0) Total 1,362 (100.0) 999 (100.0) 588 (100.0) 520 (100.0)

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8 Legal government officials, executive, managers 55~64 Years 65 Years and Above Male Female Male Female 160 ( 11.7) 18 ( 1.8) 46 ( 7.7) 11 ( 2.1) Professionals 57 ( 4.2) 10 ( 1.0) 22 ( 3.7) 2 ( 0.4) Engineers/technicians and semi-professionals 51 ( 3.7) 15 ( 1.5) 7 ( 1.2) 4 ( 0.8) Administrative/clerical 60 ( 4.4) 201 ( 20.0) 19 ( 3.2) 50 ( 9.5) Service industry workers, shop/market sales person 129 ( 9.4) 160 ( 15.9) 45 ( 7.6) 69 ( 13.0) Agriculture/fishery 342 ( 25.0) 325 ( 32.3) 326 ( 54.9) 274 ( 51.8) Technical workers and echnical management workers Machinery/equipment operator, assembly line 133 ( 9.7) 62 ( 6.2) 21 ( 3.5) 18 ( 3.4) 161 ( 11.8) 12 ( 1.2) 16 ( 2.7) 1 ( 0.2) non-skilled laborers 274 ( 20.4) 202 ( 20.1) 92 ( 15.4) 100 ( 18.9) Total 1,367 (100.0) 1,005 (100.0) 594 (100.0) 527 (100.0) The fact that employment of most of the elderly workers in Korea are concentrated in the agricultural sector and the self-employed sector must definitely be considered when coming up with long term outlooks and plans for the elderly labor market. In light of fact that these two sectors have been the main source of income for the elderly workers up until now, and that these two sectors are undergoing contraction at the moment, the number of job that needs to be created for the aged workers should be even higher than planned

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17 1 A total of 1,443 businesses were surveyed. Categorization by industry shows that 48.1% of the businesses were from the manufacturing sector, 18.3% from the construction, wholesale, retail, and food & lodging, and 16.2% from the finance, insurance, real estate, and business services. As businesses with less than 100 workers accounted for 38.4% of the companies surveyed, those with %, and 300 and above 25.7%, small businesses are rather under-represented in this study. However, if we consider the number of workers to which human resources management systems are applied, over-representation of large-sized enterprises may better reflect the reality

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35 OECD (2000), Reforms for an Ageing Society

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