KDI "If Elderly Age Adjusted '1 Year per 10 Years,' Elderly Ratio in 2100 Decreases by 36%P"

[Asia Economy Sejong=Reporter Son Seon-hee] As Korea's population structure rapidly ages, there is a possibility that the current elderly age criterion of '65 years old' could be raised by one year every decade starting in 2025. In this case, the elderly population ratio in 2100 is expected to be 36 percentage points lower than the current standard. However, it is suggested that the extent and timing of raising the elderly age should be discussed socially and policy supplements should be prepared.

Lee Tae-seok, a research fellow at the Korea Development Institute (KDI), stated in a report titled "Possibility and Expected Effects of Raising the Elderly Age" on the 6th, "If the elderly age is maintained at 65 as it is now, the burden of supporting the elderly population in Korea after 2054 is expected to be the highest among OECD countries." He added, "Considering the improvement in health status from 2025, when the burden of supporting the elderly population is expected to increase significantly, if the elderly age is continuously raised at a rate of about one year per decade, the elderly age will be 74 years in 2100, and the ratio of elderly population to the working-age population in Korea will be 60%, which is 36 percentage points lower compared to the current 65-year standard."

According to the report, Korea records the lowest fertility rate in the world (0.8 in 2021), while its life expectancy (83.7 years in 2021) is relatively high, so the elderly dependency ratio is expected to increase the fastest among major countries over the next 30 to 40 years. The elderly population ratio is also expected to rise to the highest level worldwide.

Lee said, "Korea was the youngest country among OECD countries but is now in the process of becoming the oldest country," adding, "Until the 1980s, Korea's elderly dependency ratio was the lowest among OECD countries, but from 2027 it will exceed the OECD average and after 2054 it is expected to be the highest among OECD countries."

He also noted, "The total dependency ratio will exceed the OECD average from 2034 and surpass 100% from 2058, showing the highest level among OECD countries. A total dependency ratio exceeding 100% means that the working-age population is insufficient compared to the dependent population including the elderly and youth, so a reconsideration of the concept of elderly based on sufficient health improvements and securing labor market participation possibilities is inevitable."

Currently, most domestic elderly welfare projects use '65 years and older' as the standard. This follows the elderly standard in the Elderly Welfare Act enacted in 1981, which has been maintained without adjustment for about 40 years since its enactment.

Not only Korea but most countries use '65 years and older' as the elderly standard, but the report points out that there is a lack of explicit and theoretical grounds for this. Due to the global trend of population aging and improvements in elderly health, the elderly age standard maintained for 40 years is increasingly inconsistent with reality. In particular, the sustainability of public pension systems is directly related to population aging, raising the need to reconsider the elderly age standard.

However, Lee emphasized that objective evidence must precede any adjustment of the elderly age. He said, "If the possibility of raising Korea's elderly age is theoretically judged based on life expectancy, there is a possibility of continuously raising the elderly age by about one year every 10 years," but he also suggested, "It is necessary to carefully decide the timing and extent of raising the elderly age considering the current status and long-term trends of disease and disability burdens, as well as disparities by gender, region, and income."

Furthermore, he added, "Support measures should be prepared to mitigate the damage to vulnerable groups who may have difficulty adapting to the raising of the elderly age, and sufficient advance notice should be given to increase the private sector's adaptability. Since raising the elderly age means raising the upper limit of the working-age population, continuous efforts to promote labor supply and demand for older workers considering their characteristics are also necessary."

This content was produced with the assistance of AI translation services.