S. Korea hopes to tackle future workforce shortage by widening lifetime working period

The South Korean government said Monday it plans to bring job seekers into the labor market earlier while pushing back the retirement age in an effort to preempt future shortages in the workforce.

"Compared to other developed nations, we enter the job market two years later and retire five years earlier," Prime Minister Han Myeong-sook said in a news conference.

Calling the current situation "a great loss" of labor, Han said the government will try to lower the age of employment for first-time job seekers, currently estimated at 25, by two years, as well as delay the age of retirement age by five years. No specific age for retirement has been mandated by the law, but South Koreans generally leave the workforce before they reach the age of 60.

"We don't feel a shortage in the workforce right now because the babyboomers born between 1955-1963 are currently working," said Cho Won-dong, a director at the Ministry of Finance and Economy.

"But by the time this generation retires, a sudden scarcity in the workforce may appear," he added, citing a study by the Korea Labor Institute.

South Korea is facing an impending demographic crisis as it has both one of the world's lowest birthrates and one of the world's fastest-aging populations.

In 2005, the birthrate for married women between ages 15 and 49 was 1.7 children for each woman, while the number of people aged 65 and above skyrocketed 29.5 percent to 4.4 million in the five years between 2000 and 2005, nearly 13 times the rate of growth of the entire population, according to the National Statistical Office.

The government is concerned that these factors will create a critical shortage of workers in the future, which analysts say could seriously harm the country's economic capacity.

Indicating an intent to lower the enrollment age for elementary schools, the government also suggested it will revamp vocational schools as part of its strategy to introduce labor into the market more quickly.

It said vocational schools are suited to produce workers whose skills are tailored to the changing needs of businesses.

Vocational school graduates can also fill the empty slots left by baby boomers.

"The Education Ministry has been reviewing a plan to create a flexible system where vocational school graduates can move on to vocational colleges and juggle work and family at the same time," said Seo Myeong-bum, an official at the Ministry of Education and & Human Resources Development.

According to the statement, vocational schools tailored to specific market needs will increase from 104 to 300 by 2009.

Scholarship opportunities will expand from 60 percent to 80 percent by 2008, the statement said.

However, critics say the plan falls short of realistic measures.

"I don't see anything new. It's a motley collection of what the government has been proposing all these years," said Choi Sook-hui, a researcher at the Samsung Economic Research Institute.

"Rather than forcing an extension of the retirement age, the government should step up lifetime education to improve the quality of aged workers," she said.

Professor Jeong Joo-yeon of Korea University in Seoul suggested economic solutions to counter the looming doom in the labor market.

"Without companies being able to invest and create jobs, what good is a better labor supply?" he said. "I doubt the plan's effectiveness."

Seoul, Feb. 5 (Yonhap News)