According to United Nations World Population Prospects 2015 Singapore will become a super-aged society by 2026. By then, one in five people in the country (or 1.25 million) will be aged 65 or above. The median age will exceed 44.9, up from just 18.1 in 1965. When Singapore gained independence in 1965 just 2.65 per cent of the population (or 49,757) were aged 65 or above.
Drastic improvements in life expectancy and a sharp fall in the Singapore’s birth rate have led to rapid population ageing. Between 1965 and 2014, life expectancy jumped by 16.1 years, while Singapore’s birth rate plummeted from 29.0 births per 1,000 population to just 9.1. The net result is a rapidly ageing Singapore population and the trend is unlikely to be reversed anytime soon. Singapore is sitting on a demographic time bomb.
The rate at which Singapore is ageing is remarkable. Singapore will go from being an ageing to a super-aged society in just 27 years. Japan, China, Germany and the United States took or will take 36, 32, 76 and 86 years respectively to make that transition. This rapid speed implies that ageing Singapore will have less time to prepare itself for the looming ‘silver tsunami’
Singapore has always counted on its human capital for national development, but — at current fertility and mortality rates and with zero migration — Singapore’s population will start shrinking as early as 2030. If normal migration flow is maintained, the population will begin shrinking in 2047. To survive the next 50 years Singapore needs innovative solutions to defuse this demographic time bomb.
The government will be under pressure to increase spending for aged care. One solution is to shift the fiscal burden to the younger population in the form of higher taxation. But this approach risks intergenerational inequity and tensions when the voting power of the younger population declines vis-à-vis the larger older population. In 1965, the old-age dependency ratio in Singapore was 4.9; by 2026, it is projected to hit 30.1 — for every 100 working age adults, 30.1 will be dependents.
Singapores Shrinking Armed Forces
An ageing Singapore population will lead to a reduction in military strength. The Singapore Armed Forces (SAF) is made up of mostly male conscripts. The number of 18 year-old males peaked in 2012 at 37,619. By 2026, it is expected to fall to only about 32,050. And when the total population starts to shrink in 2047, the number will have fallen to just 29,906 — a reduction of 20.5 per cent from its peak.
A shrinking population also hampers economic growth by reducing the supply of young labour. As the labour force contracts national output will fall unless there are significant gains in labour productivity. The core Singapore labour force (those aged 25–49) is expected to peak in 2020 at approximately 2.15 million workers. By 2047 we expect to see a shortfall of 341,570 workers — a 15.9 per cent drop — from its peak. For a country that spends 3–5 per cent of its GDP on defence annually, slower economic growth will impact military expenditure too.
So how can an ageing Singapore manage these demographic challenges?
Current measures to care for the aged in Singapore do not consider the desire of many to age within their own communities. Singapore is starting to change this. Many of the technologies being deployed under the Smart Nation initiative will help senior citizens to age safely in their own homes. Telemedicine — the use of cutting-edge information communication technology and self-administered medical gadgets to provide remote medical diagnosis, treatment and care — could reduce nonessential visits to the hospital for Singapore senior citizens. Meanwhile, autonomous, self-navigating vehicles will enhance senior citizens’ mobility when they do need to travel.
Between 1999 and 2013, Singapore’s health expenditure rose from 2.8 per cent to 4.6 per cent of GDP. Much of this increase can be attributed to a twofold jump in the number of people aged 65 or above. But by leveraging on certain emerging technologies future increases in health expenditure can be contained.
For instance, a new class of biotech drugs called biosimilars are 20–30 per cent cheaper than their biologic counterparts but just as effective and safe. Already prescribed in Europe and Australia, biosimilars make difficult and expensive treatments more affordable.
As Singapore’s population shrinks it is vital to ensure that the economy continues to prosper and Singapore’s defence capability is not compromised. With rapid advances in ‘deep learning’ systems advanced robots that can outperform humans in some tasks may soon be a reality.
McKinsey Global Institute estimated that by 2025 automatons could produce the output of 110–140 million full-time workers so it is conceivable that they might one day address Singapore’s population shortfall. From caregivers to labourers to sentries, automatons could well be ubiquitous in the future of ageing Singapore.
Severe, rapid ageing need not spell the end for Singapore. It presents real opportunities too. Singapore is not the only ageing society in the world — there are many. With a global ‘silver economy’ estimated by Merrill Lynch to be worth US$15 trillion by 2020, the first-mover advantages and lessons learned from the application of emerging technology to tackle ageing Singapore could prove invaluable.
Writen by Tan Teck Boon, a research fellow at the S. Rajaratnam School of International Studies (RSIS), anyang Technological University, Singapore. This article first appeared on East Asia Forum under a Creative Commons license and is reproduced here with its permission.
- Singapore feeling impact of rapidly ageing population (Today Online)
- Vibrant ageing society possible in Singapore: Gan Kim Yong (Channel NewsAsia)
- Singapore property may face ageing threat (True Investors)
It consists of an online publication and a quarterly magazine, East Asia Forum Quarterly, which aim to provide clear and original analysis from the leading minds in the region and beyond.
Latest posts by East Asia Forum (see all)
- Prioritising a Philippine–EU FTA is vital for post-pandemic recovery – July 26, 2020
- Time for Asean to stand up for itself in the South China Sea – July 25, 2020
- Myanmar’s COVID-19 recovery gets an EU boost – July 25, 2020
- Lee’s early election gamble sees PAP take a hit – July 23, 2020