Retirement extension is under discussion

The government officially started a discussion on extending retirement age for the first timein two and a half years since extending retirement to 60. However, it decided to incentivize retirement extension rather than mandating it by law to prevent side effects.

Minister Hong Nam-ki of Strategy and Finance said, “A taskforce to improve population structure is focusing on the retirement extension issue and will announce the government’s stance when it reaches a conclusion.”

He also said it would have little impact on the youth unemployment. “Every year, 800,000 baby boomers will leave the labor market while only 400,000 of young workers newly enter the market for the next 10 years,” he explained. “We are also reviewing ways to minimize the impact on the youth.” The government will include ways to extend employment of older workers in the first discussion result of the taskforce to be announced later this month. “The methods include incentivizing voluntary hiring of older workers (including the public sector).”

Additional discussions are needed for details such as the exact age of retirement. The Supreme Court ruled in February that manual workers’ workable age should be extended to 65 from 60. Local governments such as Seoul, Incheon and Ulsan extended the retirement age of bus drivers to 63 last month.


Hye-Ryung Choi herstory@donga.com