Seoul: South Korean businesses are increasingly opting to rehire retired employees rather than extend their retirement age, a recent survey revealed, with wage burdens highlighted as the primary challenge in employing senior workers.

According to Yonhap News Agency, the survey conducted by the Korea Enterprises Association found that 61 percent of companies prefer reemployment as a strategy for hiring senior workers aged 60 and above. This preference significantly surpasses the 32.7 percent of businesses that are in favor of extending the retirement age.

The survey, which polled 1,136 businesses with a minimum of 30 employees, also highlighted that 6.3 percent of the respondents advocated for the abolishment of the mandatory retirement age.

Among the businesses favoring reemployment, half suggested that a reasonable salary for reemployed senior workers should be approximately 70 to 80 percent of their pre-retirement wage. The survey underscored the challenges posed by high wages set by the seniority-based pay system, compounded by a rigid employment structure that complicates the dismissal of workers once hired.

The association emphasized the need for effective measures, such as reducing paycheck burdens, to facilitate the employment of senior workers by businesses.