Workforce to shrink to half of population by 2060: report

The proportion of the country aged 15-64 will shrink to 49.7 percent by 2060, a government report said Wednesday.

Statistics Korea said the shrinkage of the “economically active” population will be gradual as the working population began shrinking in the past five years for the first time in history.

The number of working age people, standing at 35.98 million, or 72.8 percent of the population now, will increase to 37.04 million until 2016, and decline to 21.87 million, or 49.7 percent of the country by 2060.

“Our projection is that the age group capable of supplying the labor for goods and services is declining with overall population shrinkage,” the state-run agency said.

The population aged between 25 and 49 will nearly halve in number to 48.9 percent of the working age group down, from 56.8 percent, as of end of last year.

The agency said Korea’s population will start to contract from 2031 after peaking at 52.16 million in 2030, meaning less production under reduced income and tax revenue. The country’s population stood at 49.41 million as of end of last year.

“Downsizing of the core production workforce could lead to weaker domestic demand and reduction of productivity in the long run. We would have to continue working on ways to raise productivity while promoting healthy aging,” a Finance Ministry official said.

Korea became an aging society in 2000 according to the Organization for Economic Cooperation and Development and faces exceptionally rapid population aging. It predicts the number of senior residents aged 65 and older to double to 14 percent of the total population by 2018 and reach 20 percent by 2026.

Separately, experts at a joint inter-ministerial conference on preparation for aging Wednesday urged policymakers to promote a healthy lifestyle for the baby boomer generation.

“The burden on the productive workforce to fund medical expenses for senior citizens will continue to grow. The government needs to encourage healthy aging with public healthcare programs,” Kim Nam-soon, a research fellow at Korea Institute for Health and Social Affairs said.

By Cynthia J. Kim (cynthiak@heraldcorp.com)