"How Are We Supposed to Make a Living?" 92% of Public Officials Sigh Over 'Uncertain Livelihoods,' Send SOS to Government

Retirement at 60, but pensions start at 65: a "five-year gap"
Half of retired officials short at least 2 million won a month for living expenses
Gradually raising the retirement age to 65 could cost up to 6 trillion won a year
Pay system reform a

Nine out of 10 incumbent civil servants are concerned about what is known as an "income gap" - a period without income after retirement and before they begin receiving their pensions. This is because the pension eligibility age is being raised in stages, creating a gap of up to five years between retirement and the start of pension payments. A survey found that about half of retired civil servants who had experienced an income gap suffered severe financial hardship, with their monthly income falling at least 2 million won short of essential living expenses. This has prompted calls for an urgent extension of the retirement age and effective measures to ensure income security.

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"Short 2 Million Won a Month for Living Expenses"... An 'Income Gap' Looms for 9 in 10

According to policy research presented by Chae Jun-ho, a professor in the Department of Business Administration at Jeonbuk National University, at a forum on "Income Gaps in Civil Servants' Pensions and Extending the Retirement Age" held at the National Assembly on November 10, 91.9% of 2,657 incumbent civil servants expected to face a gap in pension income after retirement. The forum was co-hosted by Assemblyman Lee Yong-woo of the Democratic Party of Korea and Assemblywoman Lee Dal-hee of the People Power Party, and co-organized by the Korean Government Employees' Union and the Federation of Government Employees' Unions of Korea.

The survey was conducted from August 13 to September 30 among 2,657 incumbent civil servants and 158 retired civil servants. Among those already retired, 24.1% said they were currently experiencing an income gap, while 15.8% said they had experienced a gap of at least one month in the past.

The financial impact of the income gap was reflected in specific figures. Of the 63 retired civil servants who had experienced or were experiencing an income gap, 50.8% said their household's average monthly income had fallen at least 2 million won short of essential living expenses. In addition, 60.3% said their retirement allowance had run out earlier than planned. The survey also found that 36.7% had no experience earning income through other work after retirement, underscoring the weakness of the post-retirement employment safety net.

Retirement at 60, but Pension at 65... The Age Mismatch Creates a 'Five-Year Gap'

The underlying cause of this income gap is the mismatch between the retirement age and the age at which pension payments begin. The retirement age for general-service civil servants is currently fixed at 60. However, following the 2015 civil service pension reform, the age at which pension payments begin is being raised in stages.

Those retiring between 2024 and 2026 will begin receiving their pensions at 62, while those retiring between 2027 and 2029 will begin at 63. For those retiring in 2033 or later, the pension eligibility age will rise to 65. This means an income gap of up to five years can occur between retirement at 60 and the start of pension payments.

Incumbent civil servants cited an extension of the retirement age as the top solution to the income gap. However, concerns remain that extending the retirement age could increase the burden on public finances and weaken new hiring among younger people. According to Professor Chae's research, gradually raising the retirement age to 65 for both general-service civil servants and teachers is estimated to result in additional annual personnel costs of between 3.76 trillion won and 6.03 trillion won, depending on the specific wage adjustment method.

"Extending the Retirement Age Should Not Simply Mean Cutting Wages"... Reforming the Pay System and Legislative Challenges

At the forum, participants voiced strong opposition to extending the retirement age by cutting wages while leaving existing workloads and responsibilities unchanged. Kim Yeong-geon, a member of the Wage and Pension Division at the Policy Planning and Research Institute of the Federation of Government Employees' Unions of Korea, cited Japan's experience with extending the retirement age and said, "If wages are sharply reduced as the retirement age is extended, the income gap may simply be replaced by a period of low income."

Park Jung-bae, senior vice chair of the Civil Servants' Union, said of early retirement pensions, "They can fill an immediate income gap, but a reduction of up to 25% may apply for the rest of a person's life." He argued that "it is not appropriate to treat this as the only solution to the income gap." He added that legislation linking the retirement age to the age at which pension payments begin should be pursued, and stressed that transitional measures should also be established for civil servants who have already retired or will retire before legislation extending the retirement age takes effect.

Participants also raised the need for tailored pay structures based on occupation and working conditions. Kim In-tae, a professor in the Division of Social Sciences at Hansung University, argued that pay standards should be designed to fit each situation, taking into account factors such as whether employees continue in the same roles, changes in job responsibilities, and reductions in working hours. Addressing concerns that new hiring among young people could decline, he proposed that the government assess vacancies by agency and job series, identify roles requiring additional personnel in areas such as AI, science and technology, and social welfare, and determine hiring levels accordingly, while providing the necessary funding.

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