It is so evident that one may not need statistics to maintain this: Korea is a fast-aging society and many of the elderly population are not financially prepared to support themselves in old age.
Yet, data in a report by the Korea Labor Institute are truly alarming: The Korean elderly have the highest poverty rate in the Organization for Economic Cooperation and Development.
The institute said the poverty rate among Korean elderly citizens aged 65 or older stood at 48.6 percent in 2011, the highest among all the 34 OECD members. This means more than 48 of every 100 Korean elderly households earn 50 percent or less than the median household disposable income. The rate is more than double the figure in Switzerland, which has the second-highest rate, at 24 percent.
A bigger cause for concern is that the poverty rate for single-person households soared to 74 percent in 2013. It is sad that many senior citizens around us are suffering from poverty, loneliness and illnesses, resulting in one of the world’s highest elderly suicide rates. The latest figures show that 81.4 out of every 100,000 Koreans between ages 65 and 74 killed themselves last year, 2.4 times the OECD average of 33.5.
The same KLI report showed that the lack of a social safety net is primarily to blame for the grim situation. It said Korea’s net pension replacement rate ― the level of net pension entitlements divided by net preretirement earnings ― was 45.2 percent in 2012, compared to the OECD average of 65.9 percent.
Today’s Korean elderly inevitably struggle financially because many of them had supported their parents when they were young, but cannot expect to receive the same financial support from their children.
The low net pension replacement rate should be a reminder for the government to take up a greater role, like increasing pension payments or other forms of income transfer to the elderly. No less important is the need to expand the job market for senior citizens.
The elderly population in Korea, which stands at 11.3 percent now, is set to break the 14 percent mark in two years, making it an aged society. Korea will have taken 18 years to see the rate increase to 14 percent from 7 percent, compared with 115 years in France, 71 in the U.S. and 24 in Japan. This indeed is a scary pace.
We need concerted, effective measures to prevent this fast shift to an aged society from becoming a catastrophe.
