The Korean Senior Citizens Association, the nation’s largest elderly organization, has formally proposed raising the official age for senior citizens from 65 to 75 over the next decade. This initiative is part of a wider strategy to address South Korea’s impending status as a super-aged society, characterized by a rapidly growing elderly population and increased life expectancy. The proposal goes beyond adjusting eligibility for senior benefits, such as pensions and transportation subsidies, by also suggesting a revision of the retirement age for those willing to remain in the workforce. Additionally, it advocates for the implementation of a peak wage system, where wages would start at 40% of their maximum and gradually decline.
At the inauguration ceremony for the Korean Senior Citizens Association’s 19th Chairman, held on Oct. 21 at the Korea Chamber of Commerce and Industry in Seoul, newly elected Chairman Lee Joong-keun (83), who also serves as chairman of Booyoung Group, underscored the demographic shifts the country is facing. He noted that by 2050, South Korea’s elderly population is expected to double, growing from 10 million to 20 million, which will constitute 40% of the total population. Lee called for a revision of the Welfare Of Senior Citizens Act to redefine the age threshold for senior citizens. Founded in 1969, the association boasts 3 million members and is the largest organization of its kind in South Korea. Lee, who stepped down during his previous tenure as the 17th chairman (2017–2020), was re-elected in August.
Raising the senior age to 75 is likely to reignite debates about increasing the legal retirement age from the current 60 to 65 or beyond. Lee has proposed a peak wage system wherein retirees at 65 would initially receive 40% of their peak salary, with a gradual reduction to 20% by age 75, effectively extending their working years by a decade. He argued that such reforms are crucial to addressing the challenges posed by a super-aged society, including pension sustainability and the provision of elder care.
The peak wage system was originally introduced in 2016 alongside the retirement age policy, which set the retirement age at 60, reducing wages by up to 50% as workers neared retirement. Under the new proposal, senior workers’ wages could be reduced by as much as 80% for part-time work. Lee also announced that Booyoung Group would voluntarily adopt this system to address aging-related challenges and senior welfare issues proactively.
In a prior effort to tackle South Korea’s declining birth rate, Lee had offered his employees a 100 million won bonus per child. Now, his focus has shifted to aging, warning that if the country’s future working population of 20 million is responsible for supporting an equally large elderly population, it could create a workforce shortage that threatens economic growth. As of July 2024, South Korea’s elderly population surpassed 10 million and is projected to reach 20 million by 2050. According to Statistics Korea, the elderly dependency ratio—the number of seniors supported by every 100 working-age individuals—will rise from 27.4 this year to 104.2 by 2072, placing a significant financial strain on the social insurance system. The Ministry of Economy and Finance estimates that spending on the four major public pension systems—national, civil servant, private school, and military—will increase from 77 trillion won ($55.78 billion) this year to 101 trillion won ($73.16 billion) by 2027.
