Policymakers often cause confusion by announcing well-intended but not-fully-thought-out measures. A case in point is one of the measures announced Sunday by the Prime Minister’s Office to help baby boomers push back retirement.
The office announced that the government would grant workers aged 50 and older the right to request reduced hours in the run-up to retirement and thereby extend employment.
The PMO said the scheme was intended to help senior workers prepare for their new jobs after retirement. It added the government would encourage management and labor to voluntarily extend the retirement age of workers by increasing its salary subsidies in proportion to the length of the extended employment period.
The government already provides subsidies to small and medium-sized companies that introduce the peak wage system to push back the retirement age of their workers.
The plan immediately attracted keen attention from employers as well as employees. It was welcome news for most employees as it would allow them to continue their main jobs for a few years beyond the official retirement age.
As such, they wanted to know when they would be granted this new right and under what conditions they would be allowed to exercise it.
Yet the PMO’s press release lacked such details. Later, it was reported that the government would sound out employers and employees on the idea next year and then write a bill for possible implementation starting in 2013.
This means the government is still not ready to listen to the views of the stakeholders about its idea, let alone implement the plan. The PMO misled people by prematurely announcing its proposal.
Yet the scheme itself is a step in the right direction. If implemented, it would significantly ease problems associated with the retirement of baby boomers.
In Korea, baby boomers are the 7.12 million people born between 1955 and 1963. They started to retire in droves last year as the eldest of them reached 55, the average mandatory retirement age at Korean companies.
The mass retirement of baby boomers is expected to create various problems, including a shortage of skilled workers at small and medium-sized manufacturing companies.
Many retired baby boomers have already started up small businesses in such sectors as retail, tourist accommodation and personal services to make a living. But many are bound to fail because the rate of success in these sectors is not high. Those who fail in their new ventures could fall into poverty.
The PMO’s plan would ease these and other problems. The government needs to step up preparations to accelerate its implementation.
