[Editorial] ‘Superaged’ Korea

South Korea has formally become a “superaged” society at a faster pace than previously expected, with policymakers and the public unprepared to tackle a host of tricky social and economic issues caused by a growing elderly population.

As of Monday, the number of South Koreans aged 65 or older stood at 10.24 million, accounting for 20 percent of the country's total population of 51.22 million, according to the Ministry of Interior and Safety.

The United Nations classifies countries where more than 7 percent of the population is 65 or older as an aging society, those with over 14 percent as an aged society and those with more than 20 percent as a super-aged society.

The superaged society label for Korea means more challenges ahead as the country has already been trying to grapple with a democratic crisis related to a persistently low birth rate.

Korea’s total fertility rate, which shows how many children the average woman will have over her lifetime, stood at 0.76 in the third quarter, up 10.1 percent from a year earlier, but it is still far from sufficient to bolster the shrinking working-age pool.

Korea became an aged society in August 2017, and it took just 7 years and four months for Korea to gain a new demographic status where individuals aged 65 and older make up one-fifth of its population. If the current pace continues, the proportion of the elderly is forecast to hit 37.3 percent in 2045.

The earlier-than-expected advent of a superaged society also points to the Korean government’s failure to capture the shifting demographic trends. Statistics Korea said in its outlook released in February that Korea’s elderly population, which was 17.4 percent in 2022, would rise to 19.2 percent this year and reach 20.3 percent next year. The forecast turned out to be overly complacent.

More worrisome is the near absence of specific government and corporate policies to deal with the worsening demographic change that can translate into a smaller workforce and higher welfare costs. This is a potentially toxic mix that could weaken the fundamental base of Korean society and its economy.

Some of the tasks of the government are to set up new standards for the age that qualifies as elderly and tweak social and economic policies. Policy discussions are needed for the country’s retirement age, which is currently set at 60.

The revision to the retirement age, which involves additional costs for the government and companies, is a hot-button issue. The second baby boom generation -- born between 1965 and 1974 -- is set to retire at age 60 but have to live without any reliable income source until becoming eligible to receive the national pension at age 65.

Companies, meanwhile, fret that an extension of the retirement age is too costly. One estimate puts the additional cost for the new retirement age at 15.9 trillion won ($10.8 billion) per year. The increase in the retirement age also results in fewer jobs for the younger generations.

Korea unveiled plans to launch a new ministry of population strategy to address its demographic crisis, but policy discussions have stopped altogether due to the political unrest following the impeachment of President Yoon Suk Yeol.

Yoon earlier pledged to reform the pension system, which is also thrown into uncertainty. On top of the pension reform, other critical demographic issues, such as the trouble-laden health insurance budget and the lack of nursing facilities, have yet to be discussed by policymakers.

A superaged society does not mean a simple increase in the elderly population; it comes with a substantial shift in social and economic structures. The government must start exploring a comprehensive redesign of policies on retirement, health services, welfare and lifelong education.