KUALA LUMPUR, Oct 7- During a panel discussion in conjunction with International Day of Older Persons last October 1 on Astro Awani, panellists said Malaysia must address the financial vulnerability of its elderly population by providing them with opportunities to contribute to the workforce, exploring pension reform, broadening social protection and formalising the informal sector.
Tengku Aira Tengku Razif, assistant representative of UNFPA Malaysia, highlighted a study that found a one per cent increase in the old age dependency ratio actually leads to an average decline in Malaysia’s GDP growth by 6.6 per cent. Old age dependency ratio refers to the number of elderly people (over 64 years old) relative to the number of working-age people (15-64 years).
As the aged population continues to rise, Malaysia’s economic growth would be compromised as the number of people in the country’s workforce would also decline. Malaysia is expected to reach aged nation status with 15.3 per cent of its population aged 60 and above by 2030.
Shrinking Demographic Dividend Period
Screenshot of Tengku Aira Tengku Razif, assistant representative of UNFPA Malaysia, speaking on Astro Awani’s special broadcast in conjunction with the International Day of Older Persons on October 1, 2024.
This scenario also means the country will cease to derive advantages from its demographic dividend. According to the Department of Statistics, this is projected to occur by 2027.
“Demographic dividend basically refers to accelerated economic growth and this is due to what we call demographic transition,” Tengku Aira explained.
“What that means is that it begins with the changes in age structure, which happens in many countries around the world, where the country transitions from high to low birth and death rates.
“So as countries progress, mortality generally falls as child survival rates increase and improve, and this is mainly because of improved health and sanitation systems.
“It often follows with declining fertility as families have fewer children, they prioritise quality lifestyle, and household resources would then be freed up to make investments for the long-term and wellbeing.
“Similarly in Malaysia, we underwent the same situation. We had significant improvements in education and health care facilities over the last few decades,” Tengku Aira continued.
“This basically means that we are basically rapidly changing our demographics. We have a higher number of older (people) and a lower number of younger (people).
“We have a smaller number of working age population contributing to the economy, which means you have less people to contribute to this so-called accelerated economic growth.
“What it means is that the demographic dividend period is shrinking. So we have less and less people in this working age population to contribute to the economy.”
To address this, policies and initiatives that address structural inequalities, enhancement of human capital and the female labour force participation rate should be put in place, Tengku Aira said.
“We need to reform the labour force as well to match what the population composition that we currently have can deliver for our economy. If we have a more older population, we should allow them to participate in the economy and similarly with women as well.”
Ageism In the Employment Market
Screenshot of Lily Fu, gerontologist and founder of Seniors Aloud, speaking on Astro Awani’s special broadcast in conjunction with the International Day of Older Persons on October 1, 2024.
However, Lily Fu, gerontologist and founder of Seniors Aloud, an online community for senior citizens with over 16,000 followers on Facebook, said age discrimination is rampant in the employment market.
“Once you’re out, like you retire at 55 or even 60, and after one or two years of enjoying your retirement years you want to get back to work — because you find that you don’t have enough savings for your retirement since you’re living longer now — the problem is this, no matter how good your CV looks once the HR director sees the age, oh my gosh, 50 something or 60 something, that’s it, it stops there.”
She opined that this was probably due to the negative image society has of older people. “They still think of us as senile, old, fragile. But we are no longer that, we are not like that. In fact, I consider myself (among) this first wave of baby boomers who have retired and are professionals and educated.”
However, she acknowledged that problems arise when senior citizens expect to be compensated based on their years of experience in the workforce.
“Because most companies can’t afford your last pay. So I keep telling my community members, for example, when you sit at the bargaining table regarding your job, please try to look at it from their point of view and not just push your own agenda. You are retired and now you want to go back.
“You cannot expect them to pay you your last drawn salary. You’ve got to negotiate, right? Maybe you can do flexi hours or part-time or something where both parties can come to an agreement and then you get what you want, they get what they want. So that’s how you go with the bargaining.”
Burden Of Care Work On Women Impedes Employment Prospects
For women, the problem is further compounded by the fact that they may have exited the workforce earlier or completely due to caregiving responsibilities. The expectation of caregiving in families, more often than not, falls on women, said Tengku Aira.
“Taking into account the social culture aspect, this is exactly the reason why women carry the majority of the burden of care work, and they are most of the time unpaid.
However, she pointed out that this phenomenon was not unique to Malaysia.“It is a global phenomenon. Social culture aspects globally actually showcase that women are the majority of (people) carrying the care burden for their families.
“So what does that mean when they carry the majority of the care burden? We will face situations where they may not be participating in the labour force.
“When they do not participate in the labour force, we lose economic growth in the country,” she said, adding that the absence of women in the labour force is a lost opportunity to enhance productivity, especially since women represent 50 per cent of the country’s population.
“So it is really, really important that we ensure that they are able to participate in the labour force. And of course, coming from UNFPA, I must say that gender equality is at the core of our mandate and (we believe) rights to opportunities and productivity should be shared equally between men and women.”
One of the ways to address the difficulties women face in reentering the workforce, Fu said, was for them to embark on entrepreneurship. Based on her observations, women tend to fare better than men when it comes to this.
“I’ve noticed that when you compare men and the women where entrepreneurship is concerned, you find that women do better.
“They can operate from home. But they have to pick up some digital skills because they have to do marketing and stuff like that, social media.”
There must be support systems to facilitate the return of older people to the workforce, Tengku Aira said. “We need to invest in re-skilling and retraining older workers, particularly in digital literacy, as (Lily) mentioned.
“There’s a role for everyone, in the public and private sector, to collaborate to ensure that the market system is actually more attractive and suitable for the older population.
“And there’s many things that we can do, jobs can be adapted, to ensure that it’s suitable,” Tengku Aira said, citing flexible working hours as an example.
“We do this as well in our office, providing monthly assignments where you have a monthly payment. So they don’t actually work full-time.
“There are many opportunities. And in this way, you’ll make the jobs more attractive for the older population, ensuring that they participate in the workforce.”
Inadequate Retirement Savings For Those Working In The Informal Sector
Screenshot of Dr Rahimah Ibrahim, director of the Malaysian Institute on Ageing (MyAgeing), speaking on Astro Awani’s special broadcast in conjunction with the International Day of Older Persons on October 1, 2024.
Another critical issue that needs to be addressed when it comes to the financial vulnerability of the elderly is the retirement fund deficit, especially for those working in the informal sector.
Malaysians who are outside of formal employment do not have adequate retirement savings, said associate professor Dr Rahimah Ibrahim, director of the Malaysian Institute on Ageing (MyAgeing) at Universiti Putra Malaysia (UPM).
“This can include gig economy workers, small-scale traders. All these people who are in the informal sector, they might not have enough (retirement) savings and they might have to work until they die because they have to maintain their livelihood.
“So we need to look at pension reform and expanding social protection for a broader number of Malaysians, broader coverage for Malaysians.”
Citing the Families on the Edge study by Unicef and UNFPA, which explored the impact of the Covid-19 crisis on women and children in low-income urban families in Malaysia, Tengku Aira said female headed households and disabled headed households were the worst impacted population and were also most susceptible to financial vulnerability.
“Basically from the study, we looked at how part of the recommendations included social assistance improvements, social protection improvements. And of course, just as Dr. Rahimah mentioned about the informal sector, unfortunately a majority of low income (people), particularly women – women who need to do all of these care responsibilities – they fall under the informal record.
“Because when they need to have a flexible working arrangement, they opt for the informal sector. So one of the recommendations was to formalise the informal sector so that they too will benefit from social protection and social assistance.
“And we also recommended social assistance to be increased for the different types of care that you have.”
“If you have a certain number of children, if you have an elderly or sick family member or disabled family members – all of these different types of support that needs to be provided should be provided.
“And formalising the informal care sector is really critical because otherwise as you grow old you will never get social protection equally with your other counterparts in the formal sectors.”
Give Older People Jobs
Fu, who said she has produced a documentary focusing on homelessness to explore the reasons and causes of it, said one of the main solutions to tackling the issue of homeless elderly is to give older people jobs.
“If we want to work, let us work. Of course, not every retiree wants to work, but those who want to and those who are fit enough, give us a job. If you can’t give us a job, help train us so that we can have our own business, because we do not want to be a burden on our children.
“We want to continue to be independent for as long as possible, take care of ourselves, and by going back to work, we are in touch with society. We are able to contribute to the economy as well. That’s what we want.”
Article by Najua Ismail for Ova.
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