Find out what Singapore's 'demographic double whammy' is

And why we must be alarmed.

Speaking at the Asian Bureau of Financial and Economics Research dinner, Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore said that the Singapore economy is facing a demographic double-whammy: the effects of low birth rates over the last two decades combined with the entry into retirement of the baby boom generation.

He noted that Singapore’s total fertility rate has been very low, at about 1.4 over the last 20 years while baby boomers entering the “65 & above” age group, where significant numbers retire and leave the workforce, will surge by 65% during 2011-2020.

"The overall impact of this double-whammy is unmistakeable: Singapore’s resident labour force will start to shrink over the next few years, even after taking into account the inflow of net migrants.

Singapore had previously supplemented its resident labour force with foreign workers. Total labour force growth averaged 3.7% per annum in the last decade (2001-2010); almost half of which was contributed by foreign workers. This is unsustainable. Foreigners (excluding foreign domestic workers) already account for about one-third of the total labour force in Singapore," he said.