Korea's high senior employment rate masks low job quality

Older job seekers pack a senior job fair at Mapo District Office in Seoul, Dec. 13, 2023. Yonhap

A 65-year-old man surnamed Kim, who retired three years ago from a medium-sized company after working in accounting, recently began working part-time stocking shelves at a neighborhood supermarket after struggling to find a new job.

Having spent nearly 30 years in financial management, he believed his expertise would help him secure another position. However, companies showed little interest in hiring older people, and most roles available for them were limited to low-paying security or cleaning jobs. Kim noted that warehouse and inventory management positions were considered relatively better options.

"I thought I could put my experience to good use, but the reality was different," he said. "Now I carry boxes for four hours a day at minimum wage. I have no choice because my pension is not enough to make ends meet."

Korea is a peculiar case, as both the poverty and employment rates for older adults are among the highest in the world.

According to the Pensions at a Glance 2023 report published by the OECD in November last year, the poverty rate among older Koreans stood at 40.4 percent — the highest among all 38 OECD member countries. This figure was nearly three times the OECD average of 14.2 percent.

Paradoxically, Korea also has the highest employment rate among those aged 65 and older across OECD nations.

According to the National Assembly Budget Office's (NABO) report released on Tuesday, the country's employment rate for the age group stood at 37.3 percent in 2023, the highest among OECD countries, and significantly higher than the OECD average of 13.6 percent.

These contrasting figures reflect the poor quality of jobs available to older adults.

Despite the high employment rate, the quality of jobs held by older workers remains poor in various aspects, including employment status and wage levels.

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The latest NABO report reveals that many older adults work as irregular employees in small businesses, often performing low-skilled labor.

Among wage-earning workers aged 65 and over, 61.2 percent are employed on a nonpermanent basis, while almost half — 49.4 percent — work at small companies with fewer than 10 employees.

In terms of job types, simple labor roles account for the largest proportion at 35.4 percent, followed by machine operators at 15 percent.

The decline in job quality leads to a significant drop in wages.

According to the report, the average monthly salary for workers in their late 50s, just before retirement, was 3.5 million won ($2,550), but this figure decreased to 2.8 million won for those in their early 60s returning to the workforce after retiring, meaning a 20.5 percent decline.

The deterioration in wages and working conditions is attributed to the disconnect between older workers' accumulated expertise and their new roles.

Among older wage earners who found reemployment after retirement, 53.2 percent responded that their current job is either "not at all" or "only slightly" related to their previous occupation.

The report urged policymakers to develop comprehensive measures to support older adults who have been displaced from their primary careers, to enable them to remain economically active.

"Korea's older population shows a strong willingness to continue working even after retirement," the report said. "Helping them stay in their primary or related fields can play a key role in reducing income gaps in old age and making better use of their accumulated skills and experience."