18 Sep Why SMEs Should Support Older Workers in Singapore
Singapore is a country with no natural resources. With great foresight from its founding fathers, they transformed what many thought was a fishing village into one of the major financial hubs today. However, the Lion City is now facing a worrying shortage of manpower packed with an ageing population.
The effects of our ageing population
A report by Oxford Economics shows that Singapore has the most to fear with her ageing population in the next two decades. First, the already-shrinking workforce will worsen and we will see slower progress getting people into the labour market as compared to our Asian neighbours.
Singapore’s labour supply will shrink by 1.7 percentage points in the next ten years through 2026, followed by 2.5 percentage points in the decade after.
Even though all Asian nations will face demographic challenges in the next 20 years, Singapore, Taiwan and South Korea rank worst in terms of the working-age population’s growth decline.
Stereotypes about hiring older employees
Though companies are always on the lookout for employees with experience, they hesitate when they see a resume of someone with age. Here are some of the common stereotypes that employers associate older employees or applicants with:
- Slower productivity due to their age
- Too set in their way of thinking
- Inability to adapt to modern technology
- Near retirement age
How older employees can add value to businesses
- Great work attitude
- Can act as mentors to younger employees
- Greater understanding of the business world
- Mature outlook of things
- Lower cost
Older employees have been in the working world for some time and they would have already develop not have a problem with punctuality. Existing older employees can act as mentors or role models to younger employees by strengthening and passing down the company culture. Another advantageous trait older employees possess is that is that they understand the business world. They are experienced in applying their theoretical knowledge into work and this is what they younger employees (fresh grads) lack.
Support from the government for older workers
The Singapore government has taken the lead into helping older workers get or remain employed. Besides raising the re-employment age from 65 to 67, they have also initiated various schemes to help retain and support this group of people. Most of these schemes are heavily subsidised and are introduced to bridge the gap between the existing labour force and what the industry or employers are looking for.
Some of the schemes include:
- Workfare Training Support (WTS)
- Lower training costs and more choices for employees
- Training allowance
- Support for basic skills training
- Rewarded for completing training
- Special Employment Credit (SEC)
- Employers can receive a SEC of upto 8% of their employees’ monthly wages for all Singaporean employees aged 50 and earning up to SGD$4000.
As at end June, the labour force participation rate is as follows:
The increase in labour force participation shows that older workers are getting hired slowly but surely. As SMEs make up 99% of Singapore’s economy, SMEs must come together and support this demographic to push the growth of the economy.