News: Upcoming Singapore budget must help solve the challenge of aging workforce: SNEF

Employee Relations

Upcoming Singapore budget must help solve the challenge of aging workforce: SNEF

Singapore’s Prime Minister Lee Hsien Loong last year shared plans to lift the statutory retirement age from 62 to 65 years by 2030. However, to hire, nurture and manage the older workforce, companies would require more support and cost benefits.
Upcoming Singapore budget must help solve the challenge of aging workforce: SNEF

As the Southeast Asian country prepares itself to tackle an aging workforce, Singapore National Employers Federation (SNEF) urges more support for hiring older workers. It calls for a wage offset scheme to accompany the raising of the retirement and re-employment ages, as well as ‘transitional support to employers, in the form of one-off wage offsets, to mitigate the higher CPF contribution rates’.

The Singapore Business Federation (SBF) also made a similar request to extend SEC subsidies for older employees’ wages, and re-introduce the Temporary Employment Credit whenever the CPF contribution rates go up.

The group would also require funding to help employers to both offer more part-time re-employment opportunities for older workers, as well as install a ‘re-careering program’, letting older workers be redeployed more smoothly as they head into re-employment.

Further, the Budget could also help to promote the portable medical benefits scheme - which covers some of employers’ costs in providing medical benefits - to enable employers to better manage rising medical costs, said the SNEF, echoing a similar suggestion by the SBF.

In Singapore, one in four seniors are still working. The employment rate for those aged 65 and older jumped from 13.8 percent in 2006 to 26.8 percent in 2018. Among the ASEAN member states, it is already the oldest society and with one of the highest life expectancies and lowest fertility rates in the world, Singapore is on the cusp of an extreme demographic shift. 

The government has already acknowledged the demographic shift its facing currently and has decided to increase the retirement and rehiring stage. However, increasing the age to work is not enough to tackle the challenge. The added medical costs and to skill the aging workforce, organizations would need more monetary benefits and budget support from the government as well. 

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Topics: Employee Relations

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