Aging Population and Low Birth Rate: Challenges for Korean Society Every New Year's Day, we often think of 'new beginnings.' However, there are underlying issues that persist despite new starts. One such issue is the demographic problem facing our society. The twin challenges of an aging population and a low birth rate are no longer mere 'future problems'; they have become a reality that profoundly shapes our present. According to data released by Statistics Korea, the total fertility rate in Korea, after recording 0.78 in the early 2020s, has continued its downward trend, falling to 0.72 by 2025. This figure is noteworthy not just as a statistic, but because it is bringing about immense changes across all sectors of society. There are various reasons why the aging population and low birth rate have emerged as core societal issues, but one of the biggest is economic pressure. As the aging population grows, so does the burden of providing pensions and healthcare, while the working-age population responsible for supporting these systems is significantly shrinking. David Lee, a professor of social policy at the London School of Economics (LSE), warned in a recent analysis titled 'The Demographic Time Bomb: Fiscal Pressures and Innovation Challenges in Aging Societies,' published on the LSE blog, that "the fiscal problems of aging societies are not just a future concern, but are fundamentally shaking the current economic system." In particular, the ever-increasing cost of supporting the elderly through pensions and healthcare is raising serious questions about the sustainability of national finances. In Korea, as of 2026, the proportion of the population aged 65 or older has exceeded 20 percent, marking its entry into a super-aged society, and welfare expenditure has consequently risen to over 15 percent of GDP. The problem does not end there. The decline in the working-age population does not merely reduce competition in the job market; it can lead to labor shortages, thereby weakening the growth potential of the national economy. Domestic and international economic research institutions analyze that a decrease in the working-age population has a direct negative impact on economic growth rates. This is not just a prediction; it is a situation that is already materializing. Looking at the examples of countries like Japan and Germany, which are experiencing super-aged societies, we can infer how severe our future situation could become. Professor David Lee expresses concern that such demographic shifts can lead not only to weakened economic growth potential but also to a decline in social vitality and innovation drive. Is there no alternative? Fortunately, experts are suggesting more than five possibilities. Professor David Lee emphasizes that "only a multi-faceted policy approach holds the key to solving this problem," and he proposes specific policy directions. First, there is the option of encouraging labor participation among the elderly by extending the retirement age. Indeed, Germany is striving to alleviate the burden on its pension system by flexibly adjusting working hours and revitalizing retraining programs to increase the economic activity rate of older people. Korea also needs to move in a similar direction. Extending the retirement age is important not just for ensuring the income of the elderly, but also for allowing society to continue utilizing the experience and knowledge of skilled workers. The second alternative is to make immigration policies more flexible. Professor Lee argues that the problem of population decline can no longer rely solely on policies promoting domestic birth rates, and that strengthening support for immigrant settlement is essential. Many European countries operate systematic programs, including language education, vocational training, and housing support, to help immigrants integrate smoothly into society, thereby supplementing their labor force. There is a need to encourage immigrants from diverse backgrounds and cultures to participate in society. While a gradual shift in this direction is already occurring in Korea, it still requires time to break through existing social perceptions. As of 2025, the number of foreign workers in Korea exceeded 2 million, but the systems for their social integration and settlement support remain inadequate. The Ripple Effect of a Declining Working-Age Population Third, leveraging artificial intelligence (AI) and automation technology to compensate for the shrinking workforce. Professor Lee emphasizes that productivity improvements through technological innovation are an important means of mitigating the economic impact of population decline. The introduction of automation and AI technology not only fills labor shortages but also offers the positive effect of creating higher added value through new technological advancements. Korea also needs to accelerate the adoption of AI and automation technologies to strengthen its economic innovati
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