Guest-of-Honour Speech at SMU ROSA Annual Symposium
Minister for Manpower, SMU Mochtar Riady Auditorium
Professor Lily Kong, President of SMU
Professor Paulin Straughan, Director of Centre for Research on Successful Ageing
Representatives from The Ngee Ann Kongsi
Distinguished guests, ladies, and gentlemen
Introduction
1. Good Morning. It is a pleasure to be invited by the SMU Centre for Research on Successful Ageing (ROSA) to speak on this very important theme of enabling our seniors to flourish even as we transit towards the endemic phase of our fight against Covid-19.
2. Even before the pandemic, we have long recognised that the ageing of our population is a key demographic trend that we must prepare for seriously. This trend is not unique to Singapore. Globally, life expectancy is increasing, and populations are ageing faster than before, but Singapore faces these demographic pressures more keenly than most.
a. By 2030, our citizen population aged 65 and above will nearly double to 900,000. That will be around 30% of our citizen population.
b. And by 2030, only 0.7 locals will be entering the workforce for every 1 local exiting.
3. Our social and economic structure will need to adjust and adapt to this profound demographic change.
a. For example, we will need to see how we can help our ageing population age more healthily. Beyond the individual benefits, this will reduce the strain on our healthcare systems.
b. But it is also equally important that we see this as a golden opportunity to tap on the accumulated human capital of our seniors, to rejuvenate our economy as we emerge from the pandemic.
Amid the Pandemic: Protecting Senior Workers’ Livelihood
4. To do this, we must first ensure that as many senior workers as possible remain productive and employed.
a. This will keep their skills current and allows employers to continue to tap on their experience and knowledge.
b. And we need to look at not just the senior workers who are in their 60s, but also further upstream, at workers who are in their 40s and 50s.
5. When COVID-19 first hit, we not only moved swiftly to save jobs, but also supported employers to expand local hiring.
a. We introduced the Jobs Support Scheme to help enterprises retain their local workers through wage support, and enhanced the Wage Credit Scheme to support wage increases for local workers.
b. We also put together the SGUnited Jobs and Skills Package to expand job and traineeship opportunities and incentivise employers to expand local hiring through the Jobs Growth Incentive (JGI). Under the JGI, employers hiring mature and senior workers receive higher support.
6. I am glad that our significant measures have helped many to stay employed.
a. A paper published by the Ministry of Finance earlier this year estimated that Singapore’s fiscal support measures have prevented a rise in resident unemployment by 1.7 percentage points in 2020. This is significant.
7. In particular, the employment of senior workers held up strongly despite the pandemic.
a. From 2019 to 2020, the employment rate for those aged 55 to 64 held steady at over 67%.
b. For those 65 years and above, the employment rate even increased slightly, from 27.6% to 28.5%.
c. This is comparable to the top OECD countries – Sweden, Iceland, New Zealand, Japan and South Korea – and reflects the fact that our senior workers continue to be important and valued by employers.
Looking Beyond the Pandemic: Strengthening the Employability and Retirement Adequacy of Our Seniors
8. As we emerge from the pandemic, we must return our focus to the longer-term goals of achieving healthy and productive longevity, and ensuring that our economy remains vibrant and dynamic.
9. How can we do so? Today, societal norms tell us that we will spend most of our lives working until retirement age, and then we stop working and achieve “freedom from work”. We need to change this mindset, and think about how we can enable Singaporeans to have the “freedom to work”, at whatever age.
10. If we manage to do this well, we will be able to tap on the vast potential of our senior workforce. A study by PricewaterhouseCoopers in 2018 estimated that if all OECD countries were able to attain the senior worker employment rate of New Zealand, which is one of the countries with the highest rate, their combined GDPs could be higher by about $3.5 trillion in the long term.
11. Beyond economic benefits, a recent study by NUS also found that senior workers who stay in work for longer had better health outcomes. Clearly, it makes a lot of sense to help our senior workers stay employed for longer if they wish to.
12. Fortunately, the work to shift societal mindsets has already begun. We recently passed legislation to raise the statutory Retirement and Re-employment Ages to 63 and 68 from 1 Jul 2022. Our aim is to raise them to 65 and 70 respectively by 2030. This sends a strong signal to both workers and employers that we will continue to support senior workers who are able and wish to continue working to do so.
13. We will be raising the CPF contribution rate for senior workers gradually over time, with the first increase on 1 Jan 2022. By doing so, we ensure that senior workers are better prepared for their retirement.
14. We have also taken other major steps to help our seniors secure a higher income in retirement.
15. About 7 in 10 active CPF members are already able to meet their Basic Retirement Sum, compared to 4 in 10 a decade ago, even as it has been gradually raised for each cohort.
16. 140,000 members made top-ups in 2020, a record high. We hope to build upon this.
17. To encourage members to set aside more in their CPF savings, we will be enhancing our CPF top-ups schemes by simplifying the process and increasing the incentives.
a. To provide additional help to members with less to retire on, we have introduced the Matched Retirement Savings Scheme this year to provide a matching grant for voluntary cash top-ups. 70,000 members have benefitted from this scheme in the first half of 2021 alone.
b. We have also enhanced the Silver Support Scheme to cover one-third of all seniors, and increase payouts by 20%.
18. Many seniors who own a house can also further boost their retirement income by unlocking the value from their property through schemes like the Lease Buyback Scheme and Silver Housing Bonus.
19. Beyond legislation and policy changes, we must also help our senior workers adapt to the rapid changes taking place in the workplace.
Senior workers face twin challenges.
a. First, they may be working in roles that rank high on the Age Susceptibility Index, a concept developed by Boston College’s Centre for Retirement Research. This means that these roles require abilities that decline quickly with age, be it cognitive or physical.
b. Second, they may also be working in roles that rank high on the Technology Susceptibility Index, developed by the McKinsey Global Institute. This means that their roles could be highly automatable, and they stand a higher risk of being displaced.
20. But we can and must turn these twin challenges into opportunities. For example, while technology may potentially displace senior workers, it can also be used to augment senior workers’ physical and cognitive abilities, to help them continue in roles which may once be thought of as unsuitable for them, or to take on new roles at higher productivity.
21. The potential is limitless, but it requires us to think hard and be creative about how we can redesign jobs and workplaces, and better harness technology to tap on the tacit skills and experience of senior workers. As we do this, we should also support senior workers who may need or wish to transition to new roles, by reskilling them. In other words, we must adopt a “plug-train-play” approach, rather than a “plug-and-play” approach.
22. If we are successful, we can move away from old cliches and concepts like “prime working age”, which imply that workers are only productive during certain ages, and instead focus on a new life-stage called the “Third Age” - the transition between one’s primary career and full retirement. The “Third Age” should be as long and extended as possible, and the focus should be on reskilling to allow Third Agers to reach new peaks in their current roles or careers, or to switch towards contribution in different roles, such as in mentorship or volunteering roles.
23. Institutions like ROSA play a critical role in helping society re-think our attitudes towards ageing, and strengthening our collective ability to harness ageing as a positive force. By leveraging its multi-disciplinary research team, and its close nexus to the industry and businesses via SMU, ROSA can undertake critical applied research that elucidates the relationship between ageing and productivity in different sectors and job settings.
24. Such research can pave the way for us to better understand how businesses can redesign jobs to harness the capabilities of senior workers more effectively, or how technological solutions or managerial practices can be used to mitigate any impact that ageing might have on productivity.
25. By building on the close partnerships that SMU has with businesses, ROSA could also help translate some of these applied research findings into pilots, before scaling them to benefit whole industries.
26. I believe our Trade Associations and Chambers and queen bee companies will be keen to collaborate with institutions like ROSA on such studies, and I encourage you to explore such opportunities.
Looking Beyond the Pandemic: Employers and Employees Play Critical Roles in Achieving Productive Longevity
27. This brings me to my last point, on the role that employers and senior workers themselves can play to achieve our vision of productive longevity.
28. The COVID-19 pandemic has underscored the need for business leaders to strengthen the resilience of their business operations. The rapidly changing economic landscape also forces businesses to become more agile and pivot quickly to new growth opportunities. To achieve this, businesses need to ensure that business transformation is not done in isolation, but rather, in tandem with workforce transformation.
29. Employers must invest in building up the human capital of their workforce, including the training and retention of their experienced senior and mature workers, many of whom have built up deep pools of tacit knowledge and know what makes the business tick.
30. Many senior workers are indeed keen to undergo training and keep their tools sharp and skills relevant. But for training to be effective, it needs to be focused, targeted, and aligned to business needs.
a. This is where simple management practices like having regular structured career conversations with senior workers can have a significant impact, by helping employers understand employees’ job expectations and training needs, and plan their training and career paths in conjunction with the company’s business transformation plans.
b. The Singapore National Employers Federation (SNEF) is developing resources to guide employers in conducting these structured career conversations.
c. The National Trades Union Congress (NTUC) is also supporting business and workforce transformation efforts, by bringing together the employers, HR, and employee representatives through Company Training Committees (CTCs), to jointly develop training plans and align a company’s workforce capabilities to its business transformation roadmap.
31. The Government will continue to give mature and senior workers our fullest support through the SkillsFuture Mid-Career Support Package, which will create more transition opportunities for mid-career workers, enhance their employability, and help them move to new and better jobs or roles.
32. I understand that my sister and brother from NTUC and SNEF will also be speaking more on the union and employers’ perspectives later on. It is with this spirit of tripartism that we can make productivity longevity a reality.
Conclusion
33. Ultimately, both employers and employees must do their part. The Government, too, will continue to provide the fullest support.
34. Most importantly, as a society, we must collectively rethink our attitudes towards ageing, and see it as a boon, not a bane. As ROSA continues to undertake its rich research agenda and shape societal discourse on ageing, I would like to offer a new mindset to add to the body of research, and that is to explore how we can transform all of our thinking from retirement, to transformation and rejuvenation.
a. We should embrace a series of job role changes as we age. Instead of remaining static, we should think of how we can transition ourselves to blend with the flow of transformative changes in age and technological advances, instead of being left behind as a result of susceptibilities. After all, age is just a number.
b. And we have to start this mindset shift today. As the old saying goes “The best time to plant a tree was 20 years ago. The second best time is now.” Even the younger ones amongst us in the audience will age one day, so it is also about creating a better future for them.
c. With ROSA, we have another strong partner in this journey, and I look forward to drawing further inspiration from your work. By working together, we can ensure that our seniors can continue to flourish for many more years to come.
Thank you.