Retirement age in S. Korea may be raised to tackle demographic crisis

But some say move would disadvantage younger job seekers, raise manpower costs

- Wendy Teo South Korea Correspondent

Seoul's first seniors-only job fair on Nov 18, with companies offering private employment opportunities for those aged 60 and above. Lawmakers are aiming to legislate a gradual increase in the retirement age from 60 to 65 by 2041, aligning South Korea with peers such as China, Japan, Taiwan and Singapore.

(ST PHOTO: WENDY TEO)

SEOUL - Mr Jin Soo-hyun was just 59 when he was asked to retire after more than three decades at his company.

It was 2015, and the global shipbuilding industry was buckling under severe overcapacity and a collapse in oil prices.

Reeling from massive losses, shipbuilders such as South Korea's Hyundai Heavy Industries - Mr Jin's employer - were forced to roll out voluntary retirement packages to cut manpower costs to try to stay afloat.

"I was so angry at that time," recalled Mr Jin, now 69 and one of more than 2,000 employees who took the golden handshake in 2015. "It wasn't about the money. We could still work. We still had ideas that we couldn't fulfil."

But, on the cusp of a demographic cliff, the country is now looking to retain senior workers in the labour force by raising the retirement age from 60 to 65.

South Korea reached a demographic milestone in December 2024, when seniors aged 65 and older, like Mr Jin and his friends, accounted for more than 20 per cent of the population.

Raising the retirement age, long a topic of debate, has thus gained renewed urgency.

In addition to a super ageing society with troubling low birth rates, South Korea is also expected to see its labour force shrink from 37.6 million in 2019 to below 30 million by 2040.

Lawmakers in Seoul are now aiming to legislate a gradual increase in the retirement age from 60 to 65 by 2041, aligning South Korea with peers such as China, Japan, Taiwan and Singapore.