This article from The Straits Times (26 Oct 2014) highlights the plight of retirees in South Korea, but it could just as easily be about retirees in Malaysia and Singapore. They face similar challenges, most of which boil down to the practice of ageism in today's society. Let's hope our government will do more, and quickly, to address these socio-economic issues.
Below are extracts from the article. You can read the full article in The Straits Times (26 Oct 2014).
No easy retirement in South Korea
SEOUL (AFP) - Out of work and out of pocket, South Korean retirees are struggling to force their way back into an unwelcoming job market in an effort to supplement meagre or non-existent pensions.
Kim Min Su, 69, receives a monthly pension of 590,000 won (S$714) – the sole source of income for him and his wife who live in a mini-apartment in Seoul.
“I wasn’t able to put much aside when I was working because nearly all of it went on raising and schooling my four kids,” Kim said after a morning spent scanning job vacancy notices at a Career Transition Centre for the elderly.
Kim, who used to earn more than 4 million won (S$4,840) a month as a head engineer at a manufacturing plant in Incheon, estimates he needs a minimum 2.0 million won a month for living expenses.
Recently, he was introduced to a small company which offered to take him on full-time for 1.2 million won.
“They basically said: ‘You’re old. Take it or leave it’,” he said.
Kim is better off than many, in that he has a little pension and help from his children.
Close to 50 per cent of Koreans over the age of 65 now live in “relative poverty” – meaning their monthly income is less than 50 per cent that of the average household income, according to the state data agency, Statistics Korea.
- ‘Retired’ in early 50s -
Retirement can come early in South Korea, with many companies pushing staff out in their early- or mid-50s. Most of those have no option but to look for work elsewhere, and the average effective age at which South Korean men actually leave the workforce is 71.1 years – the second highest in the OECD behind Mexico.
One 71-year-old at the Career Transition Centre in Seoul was still looking for work. “It used to be quite easy for elderly people to get simple jobs, working as gatekeepers or watchmen,” said Kim Yong-Sik. “These days, however, they won’t even look at you if you’re over 65.”
Like a large number of retirees, Kim tried to go into business for himself, using his severance lump sum of 130 million won in 1998 to open a home appliance store with his nephew.
The venture folded three years later and since then he’s got by as a low paid odd-job man. He and his wife now earn 200,000 won a month, supplemented by a 300,000 won handout from their children.
“It’s not nearly enough, but we’re lucky in that we’re both healthy and don’t have any real medical costs,” he said.
The government does provide new skills training but Kim said the courses weren’t really age appropriate. “I was given a six-month course on computer web design, which was a total waste of time, as nobody is going to hire somebody my age for that kind of work,” he said.
“A lot of people were left behind by the rapid technological development, especially in information technology,” said Lee In Su who heads the Korean Society of Welfare for the Aged.
Even those forced into retirement in their early 50s find it hard to get a second career going, and many choose to try it alone, sinking their savings and separation packages into a small grocery store or restaurant.
According to Statistics Korea, half of all self-employed, small business owners are now over the age of 50.
“About 900,000 retirees flood into the self-employment sector every year, causing cut-throat competition,” Finance Minister Choi Kyung Hwan said in September.
“The struggling owners of these businesses are one of the biggest structural problems in our economy,” Choi said, noting that many are left destitute when the business collapses.
In an effort to keep more people working for longer, legislation was passed in April that would ensure no worker – effective 2016 – would be obliged to retire before 60.
And in May, the government, employers confederation and unions signed a pact, encouraging firms to adopt a wage-peak system, that would allow workers to stay on longer but at a steadily reducing salary.