From next year, the entire period of military service in South Korea will be recognized as a contribution period for the National Pension.
Starting next year, South Korea will recognize the full duration of military service as a contribution period for the National Pension scheme, aimed at alleviating future income gaps for young people fulfilling their military obligations. This announcement was made by the Ministry of Health and Welfare during a report to the National Assembly's Health and Welfare Committee, indicating plans to implement the expanded 'military service credit' following amendments to the National Pension Act completed in the first half of this year. Previously, military service was credited for only six months, but this was increased to 12 months in January, with the ultimate goal of recognizing all military service periods by 2028.
The government’s move to expand military service credits is motivated by concerns over the low enrollment rates of young people in the National Pension scheme and the associated risks of inadequate retirement income. According to a report from the National Pension Research Institute, the enrollment rate for South Koreans aged 18 to 24 was only 24.3% at the end of 2023, a situation exacerbated by factors like university attendance, military service, and job searching delays that postpone their entry into the labor market. This gap in pension contributions can reduce lifetime pension payouts by more than 30%, underscoring the importance of early and sustained contributions to national pension plans.
Advocacy groups have been pushing for pension reforms that particularly benefit the youth, calling for the extension of military service acknowledgement periods. Eunsung Jin, a representative from a public pension enhancement group, emphasized that the current gaps due to military service have historically created significant barriers for young individuals in accumulating their pension benefits. The government's decision not only aims to offer recognition to military service during these formative years but is also a strategic measure to boost the pension program’s sustainability by involving more young people in contributing to it.
