Creative approaches to ageing
Across Asia, countries are coming to grips with demographic changes and seeking to improve the lives of their growing elderly populations. Japan, where the proportion of people aged 65 years and older is projected to rise from 28% now to 38% by 2050, is providing support to companies that retain older employees, as well as health, housing and mobility investments in response to emerging needs.
With accidents among senior drivers on the rise, the government plans to offer subsidies to those who install safety devices such as automatic brakes in their vehicles. Prime Minister Shinzo Abe also wants to see more commercial production of vehicles with enhanced safety features for older drivers.
South Korea, which is forecast to become the greyest developed nation by 2065, has been seeing more investment in smartphone apps and social media to enhance engagement for older residents. Meanwhile, Chinese universities are offering programmes to enhance skills, stimulate and promote social connection among the elderly.
In Singapore, the retirement age is 62 but employers must offer re-employment to those who are willing and able to work up to age 67. By 2030, the city-state expects to have a retirement age of 65 and a re-employment age of 70. Other inducements for businesses include credits that encourage recruitment of workers over 50, "job-redesign" grants that subsidise the retention of experienced employees, and health and expense support for ageing individuals.
But more initiatives and reforms are needed as the region's economies become increasingly dependent on an ageing workforce. The ageing of the elderly population itself -- many more people are living to 90 and beyond -- also has significant adverse implications for public health and long-term care systems, pensions and social protection for older people.
Rapidly ageing economies like Japan have already started to see a drop in the working-age population, prompting the government to relax immigration rules to accommodate foreign workers. Amendments to the Immigration Act in April this year introduced new visa categories for qualified foreign workers in 14 sectors, including nursing care, agriculture, construction and manufacturing.
South Korean's working-age population, those aged from 15 to 64, declined for the first time in 2017. Its total population is projected to go into decline as early as next year. Meanwhile, the number of Chinese aged 16-59 began falling in 2014, as birth rates continued its fall.
But while rapid demographic transition may be irreversible, progressive government policies and technology advancements mean economies can still thrive. With major improvements in educational attainment, most economies can expect to enjoy a continuous supply of quality human capital even as people age. Older workers are now healthier and more educated than in the past.
According to an Asian Development Bank (ADB) report, the average healthy lifespan increased by nearly seven years from 57.2 to 63.8 years between 1990 and 2017 for economies in Asia and the Pacific. Average years of education among 55- to 64-year-old people also increased from 4.6 in 1990 to 7.8 in 2015.
Historically, an ageing workforce was seen as an impediment to an economy's innovative capacity, which is a key to growth. However, recent studies suggest potentially positive impacts of a maturing and ageing workforce on productivity, because an ageing and a shrinking workforce can induce rapid adoption of labour-saving technologies.
There is an urgent need to rethink education and skills training policies, combined with mainstreaming lifelong learning. Governments should encourage adoption and application of new technologies to facilitate economic adjustments to population ageing, and policies that induce behavioural change among workers and employers.
Fast-ageing economies will need to prioritise technology adoption that fosters professional and foundational skills and improves job matching for workers, given the general difficulties faced by older workers in finding jobs. Technologies that aim to boost health and longevity are also beneficial.
Policies are also needed that connect the right technologies to the changing nature of the workforce and bring greater flexibility in labour market participation. Greater participation of an older workforce can be encouraged by promoting technological adoption and applications that can transform work and work spaces through subsidies and tax incentives.
As well, social security and tax systems should be reformed so as not to penalise or disincentivise older workers from participating in the labour force; raising the statutory retirement age is just the start. Regional cooperation to facilitate labour mobility could alleviate challenges facing individual countries at different stages of demographic transition.
If these policies can be implemented effectively, I'm sure developing economies across Asia can benefit from demographic diversity.
Acting Asia Focus Editor
Acting Asia Focus Editor