Get the mojo back - with older workers

An ageing population can actually be a game-changing opportunity for the economy, if it can harness the crystallised intelligence and entrepreneurship found in older workers


Being fired in 2017 devastated my friend, John. After the news, he sent out more than 500 job applications. He got invited to only three interviews - with no job offers. John became increasingly anxious about how to support his homemaker wife and two sons. With one in national service and another studying overseas, monthly costs rapidly gobbled up his sizeable family nest egg, built up after 30 years of working in global multinational corporations. In his 50s and highly educated with an MBA, John could not find a job nor support his family.

His situation is not unique. According to government reports, professionals, managers, executives and technicians (PMETs) continue to make up the majority of retrenched Singaporeans in the first half of this year. Experts believe that this segment will continue to bear the brunt as the employment outlook worsens.

The narrative of educated people in their 50s, 60s and older looking to reenter the labour market is often framed with descriptors such as vulnerable, job-skill mismatch, inflexible, demanding and needs coaching.

As such, given the twin threats of increasing economic volatility and the advancement of technologies like artificial intelligence with the potential to displace humans from certain jobs, older retrenched PMETs worry about their economic future.

But is it really the end of the road for them? What more can be done? Seeking insight into this topic, I eagerly anticipated the keynote speech by Professor Sarah Harper, a gerontologist from Oxford University, at the Singapore Summit in late September.

The author of the best-selling book, How Population Change Will Transform Our World, spoke about how falling fertility rates in the last 50 years in countries such as China, Japan, Malaysia and Singapore, coupled with rising life expectancy, have resulted in greying populations across many advanced economies in Asia.

Many of these countries believe that the youthful vigour and "mojo" their economies once enjoyed is gone because they no longer have the "youth dividend" - the first demographic dividend associated with having a high percentage of youth in the population.


That may well be true, but it is not quite the end of the story. She argues that if leaders can harness a population of older working ages, it is entirely possible to create the conditions for a second, perhaps more enduring, demographic dividend for the economy. Of the two types of demographic dividends, Prof Harper says the first youth dividend yields a transitory bonus. It is the second dividend which transforms that bonus into greater assets and sustainable development.

"The first dividend begins first and comes to an end [quickly], and the second dividend begins somewhat later and continues indefinitely," she says, quoting population research.

In my conversation with her, she says her most urgent message to Singapore is that an ageing population should not be seen as a burden or a societal problem to be managed, but instead a game-changing opportunity, as long as people in their 50s, 60s and older can be harnessed to transform the economy.

Underlying her thinking are the concepts of "crystallised intelligence" and "fluid intelligence". Fluid intelligence relates to the ability to solve new problems by applying well-defined logical rules. It does not rely on any external prior knowledge and experience.

In contrast, crystallised intelligence refers to the capacity to build on one's experience and knowledge to acquire new skills and to solve complex and nuanced problems.

Prof Harper's research shows that fluid intelligence degrades with age, in the same way that running speed and physical strength do. However, crystallised intelligence increases with age as people pick up new skills, scaffolded on experiences they acquire along the way, to do more complex and nuanced tasks.

In a nutshell, as people age, fluid intelligence drops, but crystallised intelligence increases, especially if workers are conscientious about increasing their skills and relevant experience.

That got me thinking: Imagine the economic outcomes if we effectively harness the tremendous, latent repositories of crystallised intelligence and entrepreneurship resident in the 50s, 60s and older demographic in our ageing population. The ageing population crisis Singapore is supposedly facing would then become a tremendous economic accelerant.

During our chat, Prof Harper shares data on how older workers, who are more experienced and well-educated, have been shown to be more successful entrepreneurs and innovators, given their professional experience and networks. She also shares how teams that are made up of younger and older workers are found to be more productive than teams composed solely of younger workers.

Economically, older workers are able to spend more of their income to drive a consumption economy, as they are no longer scrimping and saving to pay for their homes or to bring up kids. Older workers can also contribute to the economy by working longer in the jobs for which they are trained, bringing greater consistency to their jobs, and resulting in greater stability in the workplace.

In her book, she further argues: "Advances in robotics and digital communications will principally reduce low-skilled and low-waged occupations, while highly-skilled jobs requiring advanced cognitive and intuitive skills will be protected."

She makes a strong case that a workforce in the 50s, 60s and older is well placed to take highly-skilled jobs; and that it is actually the lower-skilled and younger workforce that is more susceptible to being put out of work, as technology and employment trends change.

I saw this first-hand when I was based in Germany in the early 2000s, when the German government started the Ich-AG programme. The direct translation of this scheme is Me Pte Ltd (MPL). What the German government sought to do then was to encourage unemployed people to start small businesses or do freelance work via mini start-ups which employed only themselves.

With more than four million long-term unemployed at the time, the government desperately wanted to get people back to work. The MPL scheme supported individuals with small monthly payments over three years, as well as with contributions to the German equivalent of the Central Provident Fund and health insurance.

The scheme tried to address the key complaints of older workers who were looking for work - namely, age discrimination from younger human resource managers and co-workers, and from employers who were not keen to keep them after their re-employment age came up.

In Germany, I observed how the scheme helped many demoralised and long-term unemployed workers find their feet slowly and get back into the labour market on their own terms, since they were their own bosses. Over the years, the scheme created some 2.3 million jobs in Germany and improved the lives of many older workers who had no other prospect of finding their way back into the employment market.

For Singaporeans to benefit from the second demographic dividend, the right conditions need to exist. But they themselves need to be proactive about taking the right steps to stay employed for longer.

So what happened to my friend, John? To support himself, he started his own MPL. For two years, he did various consulting projects for start-ups and technology companies. At the start, he did projects on a pro bono basis. But within a few months, as he consistently over-delivered to his clients, he picked up paid work.

Early this year, he was hired as Asia sales director by a large US multinational. It saw the value of his entrepreneurial experience as an MPL and his crystallised intelligence gathered over an extensive career.

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A version of this article appeared in the print edition of The Sunday Times on November 03, 2019, with the headline Get the mojo back - with older workers. Subscribe