The raising of the re-employment age from 65 to 67 with effect from July 1 has long been discussed, and so its enactment into legislation is cause for cheer. Singapore is no exception to the demographic time bomb faced by the developed world. A shrinking workforce has an adverse effect on the economy. As people's lifespans lengthen, moves that keep them in gainful occupation will ease the burden on the national purse. In addition, there are intangible benefits, as many studies have shown, in terms of mental and physical well-being when workers continue to be productively employed. For employers, they reap the benefit of the worker's wealth of experience and institutional knowledge. At a time when manpower is tight and experienced staff are at a premium, such resources will be of value.
The news will undoubtedly be music to the ears of older workers. With the prospect of living longer and declining investment yields, workers will have little choice but to save more. Every additional year of paid employment therefore is a bonus when it comes to building up a nest egg. The experience of workers before this change has been positive. The latest data available, from 2015, show that more than 98 per cent of private-sector local employees who wished to continue working at the age of 62 were offered re-employment. Among those who accepted re-employment in the same job, 98 per cent did not experience any cut in their basic wages.
Still, one cannot take for granted that the latest revision will yield equally positive results. The economy is slowing, while the number of workers falling into the cohort that seeks re-employment will only grow. Figures from the Ministry of Manpower show that nearly one out of every eight residents in the labour force - about 12 per cent - was 60 or older in 2015. That proportion was just 5.5 per cent in 2006. Moreover, as the disruption from technology continues to gather pace, companies under strain may opt to pay off the relatively more expensive workers with a golden handshake and replace them with cheaper staff. After all, ensuring that the older worker continues to contribute requires thought and effort on the part of companies. They may have to retool the job to ensure that older workers with poorer eyesight or less physical mobility are not disadvantaged. Training for older workers may need to be tailored to ensure that they are provided the optimum environment in which to learn.
On the part of employees, the law offers a degree of protection but they should not assume that longevity is guaranteed. To keep their part of the bargain, they need to be flexible, learn new skills and be open to opportunities that come their way. Indeed, this mindset is required of all workers, so that they stay employed till they can benefit from the new re-employment age.