For pension payouts, women getting just 60% as much as men

Posted on : 2015-12-15 16:57 KST Modified on : 2015-12-15 16:57 KST
Experts say the gender wage disparity between men and women continues after retirement, causing poverty among elderly women
An illustration depicting an elderly woman who lives alone
An illustration depicting an elderly woman who lives alone

Gender disparities in pension payouts remain a major issue, with women drawing just 60% as much in benefits as men despite their growing National Pension enrollment numbers.

The reasons for the disparities include the relatively higher numbers of low-wage and irregular positions among women, along with the many who interrupt their careers to birth and raise children. Many are now calling for measures to address an issue of low pensions potentially leading to poverty among female seniors.

Pension gap continues to grow

An analysis of National Pension Service statistics by the Hankyoreh on Dec. 14 showed the number of female enrollees rising from 1,412,958, or 27.5% of the total, in the inaugural year of 1993 to 8,797,089, or 42.4%, as of 2013. The number of male enrollees rose from 3,733,416 (72.5%) to 11,947,691 (57.6%) over the same period. In terms of enrollment at least, the gender gap has narrowed significantly.

But the gap remains severe - and in some cases has worsened - in terms of actual beneficiary numbers and the scale of pension payouts, which is a matter directly linked to senior income.

Thanks to the special old-age pension system (which pays out benefits after only five years of enrollment) and the lump-sum refund system (which allows people to receive benefits as a lump-sum package at the time of retirement), the percentage of women among all beneficiaries was actually higher than that of men in 1993 by a margin of 299,844 (51.3%) to 284,362 (48.7%). But the percentage of male beneficiaries has since grown, reaching 59.5% to women‘s 40.5% in 2013. In terms of number of beneficiaries as a percentage of the population, males represented 8.6% in 2013, compared to 5.9% for females.

The difference in average monthly benefits is also stark. In 1993, male beneficiaries received an average payout of 59,242 won (US$50.08) a month, while women received 61.44% of that, or 36,400 won (US$30.77). As of 2013, males were drawing 356,285 won (US$301.21) and women 215,207 won (US$181.94) - equivalent to 60.40% of the average benefits paid to males. In terms of percentages, the number is roughly the same; in terms of actual money paid out, the gap has markedly grown.

It’s a gender disparity that could result in a gender gap in senior poverty. A national post-retirement security panel study for 2013 showed the rate of poverty among South Korean female seniors to be 45.9% - already more than five percentage points higher than the 40.1% rate for male seniors. It‘s a situation that is likely to continue if the current gender gap remains in place.

Job disparities translate into pension disparities
 by Lee Woo-man
by Lee Woo-man

Experts agree that the biggest reason for the gender gap in national pension benefits can ultimately be traced to gender disparities in the labor market.

The relatively larger number of women working in irregular positions compared to men results in a disparity in wages. Since national pension premiums and payouts are basically based on wages, low wages result in low benefits.

Women are also enrolled in the national pension for shorter periods on average because of frequent career interruptions for childbirth and child-raising.

According to a supplementary study for Statistics Korea’s census of the economically active population for 2005-14, average monthly wages for female workers totaled 1.619 million won (US$1,370) for 2014, or 59.9% of the 2.7 million won (US$2,280) averaged by men. South Korea has ranked at the top of the OECD for wage disparities between women and men since the organization first began releasing statistics on them in 2000.

“If you analyze the reasons behind the disparity in pension benefits for women and women, you’ll find that the biggest factor has to do with disparities in the labor market,” said Yu Hee-won, an assistant researcher at the National Pension Research Institute.

“What we need is a mixture of efforts to build women’s human capital and improve their employment status, together with efforts to reduce structural discrimination between men and women,” Yu advised.

By Lee Chang-gon, staff reporter

Please direct questions or comments to [english@hani.co.kr]

 

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