WORK AFTER RETIREMENT “NEEDS REFORM”

[Anchor Lead]

We reported yesterday the Yoon suk-yeol administration's first plans for reorganizing work hours as part of their labor market reform. The recommended plan also included the necessity of social discussions related to the extension of retirement age. It states that the employment system must allow those older than 60 to continue working even when they've reached their retirement age.

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This company manufactures tanks for hot and cold water used in water purifiers. This woman had worked here for nine years before she reached her retirement age back in February, but was re-hired. Under this company's policy, employees' retirement age is maintained at 60, but those who want to continue working can be re-employed on a one-year contract that can be extended every year. They receive the same wages as at the time of their retirement.

[Soundbite] (Water tank manufacturer worker (age 60)) : "I was worried my income would disappear once I stopped working. I wanted to continue working here as I am healthy enough to work."

The employer also benefits from this policy, which has been in place for over a decade now. Manufacturing companies struggle to find production workers these days. Plus, the firm can continue to use the services of its skilled workers.

[Soundbite] Kim Yun-seop(Water tank manufacturer official) : "We need skilled workers, so we let our employees stay. Young people tend to shun small firms like ours."

This confectionery company has extended its workers' retirement age to 62 and lets them continue working on a six-month contract basis after their retirement. This way, the company can employ seasoned workers for as long as they wish to work.

[Soundbite] Ki Jong-pyo(Confectionery firm official) : "Instead of extending the retirement age further, we have agreed to cut the workers' wages to some extent."

In 2030, Korea's working-age population is predicted to decline by more than three million from a decade ago. Experts say hiring older workers is necessary to secure national competitiveness. However, a research group on labor market reform says there are limitations under the current retirement system.

[Soundbite] Kwon Soon-won(Future Labor Market Research Association) : "We advise that workers' wages and job responsibilities be adjusted to create a balance between the continuous employment of older workers and more jobs for young people."

The panel advises an overhaul of the employment system by replacing the salary step system with a merit-based one to ensure the continuous employment of elderly workers.