[UPDATED 21 Feb, 12.30pm: Correction. Professor Wolfgang Lutz is not, as earlier reported, a senior research fellow at the Institute of Policy Studies. That title has been removed as well as a paragraph that said Lutz encouraged Singapore's government to boost workforce productivity first before allowing for steep population increases, as the professor has highlighted he did not make that specific recommendation.
Singapore’s population in 2030 will not be as large and its older people as unproductive as what the government expects, an Austrian demography professor said Tuesday.
In a public lecture organised by the Institute of Policy Studies to some 140 attendees at RELC International Hotel, Professor Wolfgang Lutz, founding director of the Wittgenstein Centre for Demography and Global Human Capital, estimated that Singapore’s population that year would be 6.1 million, bearing into account increases in the city-state’s population every 5 years since 1970.
In a recent white paper, the government projected that there would be between 6.5 million to 6.9 million people in Singapore by 2030, sparking a backlash among Singaporeans, many of whom have complained that the large influx of immigrants in recent years have strained infrastructure and pushed up the cost of living.
Government leaders have also maintained that a steady, albeit lower, pace of immigration would be needed to sustain economic growth to compensate for Singapore’s low total fertility rate and ageing population.
In his hour-long presentation, Lutz declared that the negative effects of an ageing population have been blown out of proportion and argued that Singapore’s vast tertiary-educated population core will counter the consequences of low replacement levels.
“There is indeed no empirical evidence so far that the ageing of the workforce is bad for economic growth. We see life expectancy increasing and elderly people being in good health,” Lutz explained to Yahoo! Singapore. “There is no reason why they could not and should not make a contribution to society. If you factor this in, the old age dependency burden becomes less.”
Argument against a retirement age
With longer life expectancies, Lutz said, "I think there is no reason to have a government-set universal retirement age".
Currently, the statutory minimum retirement age in Singapore is still 62, but employers are required to offer re-employment to eligible employees who turn 62, up to the age of 65.
Lutz reasoned how the lack of a pension scheme and the government’s encouragement towards self-sufficiency made such a retirement age redundant.
“People have different preferences, financial situations and health status. If somebody thinks he or she can afford to retire at the age of 50 and vice versa, why not? The government pension schemes need to be structured flexibly based on an insurance principle, however,” said Lutz.
Lutz said Singapore, like Germany, could be among the countries with the oldest population in the world but still be able to thrive with a knowledge-based economy.
He said that a high proportion of 50- to 60-year olds would yield good results for Singapore’s economy as they would have come mostly from high levels of education and, thus, be able to contribute in terms of experience and foresight.
Meanwhile, attendees voiced concerns of over-education in which too many citizens have to fight for too few jobs.
In response, Lutz said that lifelong learning and broad education were ways citizens could combat such problems. He urged governments to put in place more measures in schools to welcome back citizens for continued education at more periods in their lives.
“There is never a point when we feel that we have learnt enough. A broader tertiary education gives the basis for people to learn more skills. As our lives get longer, why do we have to push all education in the first part of life?” said Lutz.
Redefining what is an old age
One of Lutz’s suggestions to recalibrate expectations of an ageing population is to redefine what exactly an age that is considered to be old, is. Doing so would change the measure of the number of working people needed to support the old, Lutz said.
In the white paper, the government expected a drop in the number of working citizens supporting the aged, from a current ratio of 5.9 working-age citizens for each citizen aged 65 and above, to a ratio of 2.1 by 2030.
“70 is the new 60. Educated, old members still can be a productive part of society. Looking at Singapore’s population in an international context, Singapore has one of the strongest transformative societies in recent human history,” said Lutz, referring to the drastic jump in higher-educated residents.
Lutz caused much conversation when he said last Wednesday that Singapore’s optimal TFR should be 1.7, lower than the replacement level of 2.1. He is in Singapore for three weeks as a distinguished professor of the National University of Singapore Society. Lutz is founder and director of the Wittigenstein Centre for Demography and Global Human Capital.