|Much has been said about swelling household debt and its dangers. Yet what draws popular attention in the Bank of Korea’s report Thursday was its demographic analysis: for the first time, people aged 50 or more took out nearly 50 percent of total consumer debt.
This shows what the nation has long dreaded is turning into a reality. The baby boomer generation, which refers to people born between 1955 and 1963 here, is falling into the poverty trap of old age. In a country with strong family bonds, the 50-somethings are the most squeezed financially as they have to support both their parents and children, even while they are pushed out of the job market.
The BOK report reaffirms difficulties facing the retiring boomers. More than half of them need new loans to repay interests for mortgage lending amid falling home prices, or to open their own businesses, mostly franchised eateries, pubs or coffee shops, in the latter years of life when most of their foreign counterparts live on pensions.
In contrast to some European pensioners, Koreans demonstrate to work longer. People with doctoral degrees and former managers at large firms make long queues to work as supermarket cashiers that fetch $800 a month.
Reports show Koreans leave their lifetime job at 54 years on the average but work until 71 years, meaning most of them move around from one job market to another on their own. Little wonder the nation’s notorious old-age poverty rate of 45.1 percent is more than three times higher than the OECD average of 13.5 percent. If left unsolved, the baby boomer problem will emerge as another source of inter-generational conflict in addition to the unemployed youth issue.
To its credit, the government is not sitting idly by, but it has fallen far short of tackling the issue in earnest.
Economic ministries, for instance, are offering courses on starting businesses, including how to avoid deceptive franchise operators, and trying to supplement a social safety net by rectifying the unreasonable increase in medical insurance fees upon retirement. These are meaningful steps, but far from being a fundamental remedy _ raising the retirement age. The times has long past for Korea to gradually extend its current age limit of 55-58 to 60-65 as is the case in Japan and many European countries.
Businesses, especially large companies, are most fervent opponents to a prolonged working age, citing the high jobless rate among the young. “You are taking away your children’s jobs,” they say. But labor experts find little direct relationship between retirement age extension and the youth unemployment rate, as most companies do not fill the void left by retirees with fresh workers. These are two different employment issues to be approached separately.
This is the first Korean generation that supported their parents but do not expect similar services from their children.
Society needs to grant their wish to live on with a minimal dignity instead of being a burden on the next generations, including their own offspring. There is not much time left for action.
4월 24일 (화) The Korea Times 사설