Implications: Digitization of South Korea’s service sector further isolates an already-vulnerable community: the elderly. The growth of contact-less tools and financial transactions have reduced accessibility for the elderly despite the government’s attempts to improve digital education and ownership of smart devices. For instance, the proportion of those in their 60s and 70s who rely on digital banking is significantly lower than the rest of the population. Correspondingly, the reduction in the number of physical bank branches and bank tellers has constrained the elderly community’s access to these services. The national government is concerned that the digital gap between generations is continuing to widen, affecting the elderly’s access to not only financial services but also health services or even basic goods.
Context: The gap in digital literacy between the younger and older generations may worsen the socio-economic status of the country’s aging population. Currently, almost half of the elderly population in South Korea live in relative poverty (living on less than 50% of the disposable median income). This is a looming challenge for an aging society as the elderly are projected to constitute 20% of the country’s population by 2025. The pandemic also led to increased isolation of the elderly as they spend more time at home, creating hardships in maintaining employment or connecting with their communities. These economic hardships, coupled with prolonged isolation, suggest that existing social safety nets remain insufficient in caring for this vulnerable population.
This briefing comes from Korea View, a weekly newsletter published by the Korea Economic Institute. Korea View aims to cover developments that reveal trends on the Korean Peninsula but receive little attention in the United States. If you would like to sign up, please find the online form here.
Korea View was edited by Yong Kwon with the help of Sean Blanco, Marina Dickson, and Jina Park. Picture from flickr user Bridget Coila