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Focus on Older People In and Out of Employment

Record High Proportion of Older Residents Working in June 2007

Boosted by the sustained economic growth and strong job creation in recent years, a record high proportion of the older resident population was employed in Jun 07, mainly reflecting the entry of many older people into the workforce. Nevertheless, there is still a sizeable pool of older residents outside the labour force, particularly among women. The majority of the older economically inactive women have limited or no labour market experience, suggesting that efforts to help them enter the workforce could be complemented by suitable skills upgrading and work preparation programmes, in addition to facilitating part-time and flexible work options.

2.   These are some of the key findings of an occasional paper on “Focus on Older People In and Out of Employment” by the Ministry of Manpower's Research and Statistics Department. The paper examines the characteristics of older people both in and out of employment, including their means of financial support, motivation to work and the previous work experience of those out of work. The paper also compares the employment characteristics of older workers relative to their younger counterparts.

Main Findings

Older Residents at Work

3.   In Jun 07, 47.8% of the resident population aged 50 & over were employed, surpassing the previous record1 of 46.0% a year ago. The bulk of the increase (1.5%-points out of 1.8%-points gain) in employment rate stemmed from the entry of older people into the workforce, as evident in the decline in proportion of economically inactive among the older population from 51.9% in Jun 06 to 50.4% in Jun 07. The proportion of unemployed dropped by 0.3%-point to 1.8%.

4.   There were 469,400 employed residents aged 50 & over in Jun 07, constituting 26% of the resident workforce. Land transport & supporting services (52%), administrative & support services (incl. cleaning and security services) (42%) and restaurants (41%) had the highest incidence of older workers, with more than four in ten of their resident workers aged 50 & over. At the other end, the incidence of older workers was lowest in IT & other information services (5.8%), electronic products manufacturing and financial institutions (both 12%).

5.   Reflecting their weaker educational profile, two in three older workers were employed in non-Professional, Managerial, Executive & Technical occupations such as clerical, sales & service workers (25%), production & related workers (24%) and cleaners, labourers & related workers (18%). Cleaners, labourers & related workers (57%), plant & machine operators & assemblers (43%) and working proprietors (41%) had the highest incidence of older workers in their resident workforce. In contrast, only a small proportion of residents working as professionals (10%) or technicians & associate professionals (15%) were aged 50 & over.

6.   The majority of older workers were in salaried (73%) and full-time employment (90%). However, older workers were more likely to be self-employed (27%) and work part-time (10%) than those younger (11% and 4.8% respectively).

Older Residents Seeking Work

7.   While the strong economic performance in recent years has lifted employment prospects for older residents, they continued to register higher long-term unemployment rate2 (0.9%) than those younger (0.4-0.7%) in Jun 07. Nevertheless, all age groups saw an improvement.

8.   Nearly all (99%) older job seekers had worked before. While the majority of them (54% or 9,500) had worked within the last year, there was still a sizeable group of 34% (5,900) who had not worked for at least 2 years.3 Given that skills obsolescence is likely to set in the longer one is out of work, it is important for older job seekers to upgrade their skill sets to enhance their chances of securing employment.

9.   The vast majority of older job seekers sought employment mainly because of financial considerations. Two in three (66%) job seekers aged 50 & over in Jun 06 wanted to work mainly because they needed money for current expenses. Another 12% sought work for future financial security. Only a minority cited non-monetary factors such as needing to occupy time (6.3%), wanting to lead an active life/have social contact at work (6.1%), or having a sense of purpose/being useful (3.9%) as their main reason for seeking work.

Older Residents Outside the Labour Force

10.   In Jun 07, about half or 495,300 of the residents aged 50 & over were economically inactive. This included 219,600 who were aged 50 to 64 comprising 50,500 men and 169,200 women. Two in three (67% or 113,100) economically inactive females aged 50 to 64 in Jun 07 had either stopped working for at least a decade or never worked before. Given the rapid changes in the economic landscape and job requirements, this group of economically inactive females may lack the required skills to secure employment in today's job market. Hence, programmes aimed at encouraging older women back to work will need to be complemented by suitable skills upgrading and work preparation programmes, given that the majority of them have limited or no labour market experience. Together with availability of part-time and flexi-work arrangements, this will help encourage economically inactive residents to join the workforce.

11.   Largely reflecting the concentration of the less educated among them, the majority (76%) of economically inactive residents aged 50 & over in Jun 06 mainly relied on income support from family members4. The proportion was significantly higher for those with below secondary qualifications (82%) compared to the tertiary educated (37% for both polytechnic diploma and degree) whose top source of financial support was savings (polytechnic diploma: 46%; degree: 42%). This finding confirms the importance of the family unit as a key pillar of financial support for the economically inactive, especially among the less educated who are likely to have difficulty accumulating sufficient savings for old age. It also underscores the importance of job re-design and training to enhance the employability of less educated older residents to help boost their financial security, given falling family sizes.

12.   The report is available online on the Ministry of Manpower's website.

1The data series started in 1991.
2Refers to the share of long-term unemployed (i.e. those unemployed for at least 25 weeks) in the resident labour force.
3This does not represent duration of unemployment as the job seekers may not necessarily have been seeking work throughout the entire period.
4Latest available data on main reason for wanting to work for the unemployed and main source of financial support for the economically inactive are for 2006.