SINGAPORE: A government scheme that allows workers to continue working for a longer age has seen “very good progress” in the past five years, said Minister of State for Manpower Sam Tan in an exclusive interview with Channel NewsAsia.
The number of complaints on re-employment the Manpower Ministry has received also remained low, over the years, he added.
The retirement and re-employment act was first introduced in 2012, specifying that companies are obligated to offer workers the chance to work even after they reach the minimum retirement age of 62.
To be eligible for re-employment, workers must be Singaporeans or permanent residents. They must also have worked for their employers for at least three years. These workers need to have satisfactory work performance, as assessed by the employer and be medically fit to continue working.
People are also living longer: Numbers from the Department of Statistics showed that there were just 50 centenarians in 1990, but 25 years later more than 1,000 people celebrated their hundredth birthdays.
Mr Tan said some of the older workers may not want to spend the next 20 or 30 years in retirement "doing nothing".
"They want to look for opportunities to continue working. There is a need, from both the supply and the demand side, in terms of our manpower situation in Singapore.”
For Madam Sharifah Ibrahim, who is a kitchen assistant at casual dining restaurant Mata Thai, this move allows her to continue working even at the age of 70.
“I work here because I'm already old. I also don't do anything at home so working is better for me, can exercise. I don't have anything to do at home also. My children are all grown up," she said.
RAISING THE RE-EMPLOYMENT AGE AND GAUGING ITS SUCCESS
More recently, changes that kicked in since July this year included raising the re-employment age from 65 to 67. Employers have the option to transfer their obligations to another company, but cannot change the workers’ wages once they turn 60.
So far, the Manpower Ministry said the feedback has been positive since the scheme was launched. For instance, the number of cases the ministry sees concerning re-employment has remained low at around 40 cases per year. These disputes are mostly resolved through mediation, according to the ministry.
Mr Tan noted that a recent survey had found that 98 per cent of workers who reached 62 years old were offered re-employment opportunities by their employers.
“On the other hand, we feel a lot of feedback from the employers, that as it is getting more challenging to get younger workers to join the company, increasingly they turn their attention to the older workers and they will try to retrain them, up-skill them, so that they will be able to fit in the new working environment,” Mr Tan said.
A separate study by the Trade and Industry Ministry also found that since the retirement and re-employment act was enacted, the employment rate of those between 65 and 67 had gone up by 1.6 percentage points each year.
But the Singapore University of Social Sciences’ Associate Professor Randolph Tan raised concerns over the timing of raising the re-employment age, with employers grappling with issues like a tightened supply of foreign manpower and mismatches in the labour market.
“The benefits of raising the re-employment age may not be immediately obvious, especially to employers. The reason why the situation for employers is particularly challenging is because I think they have had to deal with new labour market realities. All these kind of adjustments will take time.”
“So the raising of the re-employment age at this time, in my personal opinion, may actually put an additional regulatory burden on them. I think it's temporary, and I think it's a reality that Singaporean employers have to try to adjust to, in the longer term,” added Assoc Prof Tan, who is a director at the university’s Centre for Applied Research.
“But I am concerned that whether in the immediate term, they can actually make the adjustments that are necessary for them to tide over this challenging time."
TECHNOLOGY, MISMATCHES AND GETTING OLDER WORKERS TO ADAPT
There is also the question of why employers should extend the careers of their older employees over hiring younger workers.
Hong Hua Holdings managing director Lim Teik Soon said: “I don't deny that younger workers are stronger and faster than older workers. That's their advantage. But we won't reject older workers. The problem we face is that turnover for younger workers is higher. But for older workers, they want a sense of belonging.”
Speaking to Channel NewsAsia, Manpower Minister Lim Swee Say said a solution could be found through technology. "We believe that the technology and innovation can actually make our workforce more inclusive (and) can make the jobs of our mature workers safer and smarter."
At Mata Thai restaurant, for example, iPads were introduced with the help of government grants for workers to better take orders. - helping employees who cannot read and had to previously rely on memorising the entire menu.
INCENTIVISING HIRING OLDER WORKERS
Aside from government grants to encourage companies to re-look their job processes, there are also schemes to offset the costs of hiring older workers.
This includes WorkPro, a further enhancement, that supports such efforts through things like a job redesign grant, and an age management grant.
But these incentives could lose its efficacy over time, said Assoc Prof Tan.
“If I have any concern, it is that the incentives to encourage employers to hire mature workers have been in force for too long. And because they are in force for too long, I actually believe that their efficacy will actually start to diminish over time.”
The alternative will be to encourage workers to continue upgrading their skills, and remain adaptable, he said.
Mr Sam Tan added: “Ultimately, I think it is important for our employers and also the older workers to recognise one thing. That in this day and age of rapid development globally, I think companies and workers will have to rejuvenate themselves, reinvent themselves, to be able to compete effectively, globally.”