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https://www.ft.com/content/edad1432-2591-11e8-b27e-cc62a39d57a0

South Korea’s elderly overtake young in the workforce

South Korea’s elderly overtake young in the workforce Poverty forces over-60s to keep working while youths struggle to find jobs Some 4.2m South Koreans over 60 are 'economically active' and poverty affects almost half the over-65s © Bloomberg Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) Save Save to myFT Bryan Harris in Seoul MARCH 11, 2018 8 South Korea has more economically active people aged over 60 than in their twenties, according to government statistics that highlight the demographic and economic crises facing the east Asian nation. Governments from western Europe to Japan are facing challenges as ageing populations trigger labour shortages and increasingly onerous social welfare liabilities. But nowhere is the issue as grim as South Korea, where unparalleled levels of elderly poverty are forcing many pensioners into menial jobs to make ends meet. Elderly poverty affects almost half of South Koreans over the age of 65 — a rapidly expanding demographic that will comprise more than 40 per cent of the country’s population by 2060. In December the nation reported more deaths than births for the first time as its fertility rate plunged to new lows. “If the natural population decrease continues, South Korean society will face serious difficulties from the greatly reduced number of young people and the relatively big portion of old people,” said Lee Sam-sik, head of the Ageing Society Research Institute at Hanyang University.  “It will be difficult to maintain the overall industrial structure given the decreasing number of working people and the reduced levels of consumption.” Share this graphic South Korea’s youth demographic is also facing challenges. Youth unemployment is hovering around 10 per cent as the nation’s economy struggles to find jobs for a highly educated workforce. “Unless there is a change in the social structure, such as easing job shortages or providing more housing, it will be difficult to convince young people to have more children,” said Prof Lee. The situation raises questions about South Korea’s economic model. Annual economic growth is roughly 3 per cent. But the nation’s manufacturing-heavy, export-oriented model — responsible for South Korea’s rapid development over the past 70 years — is fraying amid increasing competition from neighbour China and the growing threat from artificial intelligence and automation. South Korea’s youth also have little interest in pursuing the blue-collar jobs of their parents. Share this graphic Official figures released on Sunday showed that in 2017 4m South Koreans in their twenties were “economically active” — a term describing someone who is employed or searching for a job. The corresponding figures for South Koreans in their sixties was 4.2m, up from 3.9m the previous year. The statistics reflect the growing portion of older people in South Korea. The population of people aged 60 or more increased by nearly half a million last year. But the data also speak to the issues of elderly poverty as well as the nation’s corporate culture. Many of the country’s top conglomerates push staff to retire before the age of 60 despite South Koreans having one of the highest life expectancy rates in the world. The situation forces many older people to search for new jobs — often unskilled work — as the state pension is minimal. South Korean President Moon Jae-in has vowed to alleviate the situation by increasing the monthly stipends from Won200,000 ($180) to Won300,000 by 2021.  Additional reporting by Kang Buseong